Summary Of Significant Accounting Policies

B. Summary of significant accounting policies

(1) Accounting estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from these estimates. Significant estimates impacting the consolidated financial statements include accruals that have been established for contingent liabilities, pending claims and legal actions arising in the normal course of business, useful lives of property, plant and equipment, residual values of tanks, capitalization of customer tank installation costs, amortization methods of intangible assets, valuation methods used to value sales returns and allowances, allowance for doubtful accounts, fair value of reporting units, recoverability of long-lived assets, assumptions used to value business combinations, fair values of derivative contracts and stock-based compensation calculations.

(2) Principles of consolidation: The accompanying consolidated financial statements present the consolidated financial position, results of operations and cash flows of Ferrellgas Partners, its wholly-owned subsidiary, Ferrellgas Partners Finance Corp., and the operating partnership, its majority-owned subsidiary, after elimination of all intercompany accounts and transactions. We have determined that the operating partnership is a variable interest entity for whom Ferrellgas Partners has no ability through voting rights or similar rights to make decisions and thus does not have the power to direct the activities of the operating partnership that most significantly impact economic performance. However, we have determined that the accounts of Ferrellgas Partners’ majority-owned subsidiary should be included because Ferrellgas Partners is most closely associated with the operations of the operating partnership due to the fact that Ferrellgas Partners has the obligation to absorb the losses of and the right to receive benefits from the operating partnership that are significant to the operating partnership and substantially all the assets and liabilities of Ferrellgas Partners consist of the operating partnership. The operating partnership includes the accounts of its wholly-owned subsidiaries. The general partner’s approximate 1% general partner interest in the operating partnership is accounted for as a noncontrolling interest. The wholly-owned consolidated subsidiary of the operating partnership, Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), is a special purpose entity that has agreements with the operating partnership to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Certain prior-year amounts have been reclassified to conform to the current-year presentation.

(3) Fair value measurements: Ferrellgas measures certain of its assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants – in either the principal market or the most advantageous market. The principal market is the market with the greatest level of activity and volume for the asset or liability.

The common framework for measuring fair value utilizes a three-level hierarchy to prioritize the inputs used in the valuation techniques to derive fair values. The basis for fair value measurements for each level within the hierarchy is described below with Level 1 having the highest priority and Level 3 having the lowest.

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.

Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

(4) Accounts receivable: Accounts receivable are reported on the consolidated balance sheets at the gross outstanding amount adjusted for an allowance for doubtful accounts. Accounts receivable that are acquired are initially recorded at fair value on the date of acquisition. Provisions for uncollectible accounts are established based upon our collection experience and the assessment of the collectability of specific amounts. Accounts receivable are written off in the period in which the receivable is deemed uncollectible.

(5) Accounts receivable securitization: Through its wholly-owned and consolidated subsidiary Ferrellgas Receivables, Ferrellgas has agreements to securitize, on an ongoing basis, a portion of its trade accounts receivable.

(6) Inventories: Inventories are stated at the lower of cost or net realizable value using weighted average cost and actual cost methods.

(7) Property, plant and equipment: Property, plant and equipment are stated at cost less accumulated depreciation. Expenditures for maintenance and routine repairs are expensed as incurred. Ferrellgas capitalizes computer software, equipment replacement and betterment expenditures that upgrade, replace or completely rebuild major mechanical components and extend the original useful life of the equipment. Depreciation is calculated using the straight-line method based on the estimated useful lives of the assets ranging from two to 30 years. Ferrellgas, using its best estimates based on reasonable and supportable assumptions and projections, tests long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of its assets or asset groups might not be recoverable. The recoverability tests for property, plant and equipment are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas management’s plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

(8) Goodwill: Ferrellgas records goodwill as the excess of the cost of acquisitions over the fair value of the related net assets at the date of acquisition. Ferrellgas tests goodwill for impairment annually during the second quarter or more frequently if events or changes in circumstances indicate that it is more likely than not the fair value of a reporting unit is less than the carrying value. Ferrellgas has determined that it has two reporting units for goodwill impairment testing purposes. As of July 31, 2019, one of these reporting units contains goodwill that is subject to at least an annual assessment for impairment by applying a fair-value-based test. Under this test, the carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units as of the date of the evaluation on a specific identification basis. To the extent a reporting unit’s carrying value exceeds its fair value, the reporting unit’s goodwill is impaired. The amount of impairment would be equal to the lesser of the excess of reporting unit carrying value over its fair value and the reporting unit’s recorded amount of goodwill. Ferrellgas completed its most recent annual goodwill impairment test on January 31, 2019 and did not incur an impairment loss. For fiscal 2018, the test was performed on January 31, 2018, and an impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment was recorded.

(9) Intangible assets: Intangible assets with finite useful lives, consisting primarily of customer related assets and non-compete agreements, permits, favorable lease arrangements and patented technology are stated at cost, net of accumulated amortization calculated using the straight-line method over periods ranging from two to 15 years. When necessary, intangible assets’ useful lives are revised and the impact on amortization reflected on a prospective basis. Trade names and trademarks have indefinite lives, are not amortized, and are stated at cost. Ferrellgas tests finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of these assets or asset groups might not be recoverable. Ferrellgas tests indefinite-lived intangible assets for impairment annually on January 31 or more frequently if circumstances dictate. The recoverability tests for definite-lived intangible assets are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas management’s plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

(10) Derivative instruments and hedging activities:

Commodity and Transportation Fuel Price Risk.

Ferrellgas’ overall objective for entering into commodity based derivative contracts, including commodity options and swaps, is to hedge a portion of its exposure to market fluctuations in propane, gasoline and diesel prices.

Ferrellgas’ risk management activities primarily attempt to mitigate price risks related to the purchase, storage, transport and sale of propane generally in the contract and spot markets from major domestic energy companies on a short-term basis. Ferrellgas attempts to mitigate these price risks through the use of financial derivative instruments and forward propane purchase and sales contracts. Additionally, from time to time Ferrellgas risk management activities attempt to mitigate price risks related to the purchase of gasoline and diesel fuel for use in the transport of propane from retail fueling stations through the use of financial derivative instruments.

Ferrellgas’ risk management strategy involves taking positions in the forward or financial markets that are equal and opposite to Ferrellgas’ positions in the physical products market in order to minimize the risk of financial loss from an adverse price change. This risk management strategy is successful when Ferrellgas’ gains or losses in the physical product markets are offset by its losses or gains in the forward or financial markets. The propane related financial derivatives are designated as cash flow hedges. The gasoline and diesel related financial derivatives have not historically been formally designated and documented as a hedge of exposure to fluctuations in the market price of fuel.

Ferrellgas’ risk management activities may include the use of financial derivative instruments including, but not limited to, futures, swaps, and options to seek protection from adverse price movements and to minimize potential losses. Ferrellgas enters into these financial derivative instruments primarily with brokers who are clearing members with the Intercontinental Exchange or the Chicago Mercantile Exchange and, to a lesser extent, directly with third parties in the over-the-counter market. All of Ferrellgas’ financial derivative instruments are reported on the consolidated balance sheets at fair value.

Ferrellgas also enters into forward propane purchase and sales contracts with counterparties. These forward contracts qualify for the normal purchase normal sales exception within GAAP guidance and are therefore not recorded on Ferrellgas’ financial statements until settled.

On the date that derivative contracts are entered into, other than those designated as normal purchases or normal sales, Ferrellgas makes a determination as to whether the derivative instrument qualifies for designation as a hedge. These financial instruments are formally designated as a hedge of a specific underlying exposure, and that designation as well as the risk management objectives and strategies for undertaking the hedge transaction are documented. Because of the high degree of correlation between the hedging instrument and the underlying exposure being hedged, fluctuations in the value of the derivative instrument are generally offset by changes in the anticipated cash flows of the underlying exposure being hedged. Since the fair value of these derivatives fluctuates over their contractual lives, their fair value amounts should not be viewed in isolation, but rather in relation to the anticipated cash flows of the underlying hedged transaction and the overall reduction in Ferrellgas’ risk relating to adverse fluctuations in propane prices. Ferrellgas formally assesses, both at inception and at least quarterly thereafter, whether the financial instruments that are used in hedging transactions are effective at offsetting changes in the anticipated cash flows of the related underlying exposures. Any ineffective portion of a financial instrument’s change in fair value is recognized in “Cost of product sold - propane and other gas liquids sales” in the consolidated statements of operations. Financial instruments formally designated and documented as a hedge of a specific underlying exposure are recorded gross at fair value as either “Prepaid expenses and other current assets”, “Other assets, net”, “Other current liabilities”, or “Other liabilities” on the consolidated balance sheets with changes in fair value reported in other comprehensive income.

Financial instruments not formally designated and documented as a hedge of a specific underlying exposure are recorded at fair value as “Prepaid expenses and other current assets”, “Other assets, net”, “Other current liabilities”, or “Other liabilities” on the consolidated balance sheets with changes in fair value reported in “Operating expense” on the consolidated statements of operations.

Interest Rate Risk.

Fluctuations in interest rates subject Ferrellgas to interest rate risk. Decreases in interest rates increase the fair value of Ferrellgas’ fixed rate debt, while increases in interest rates subject Ferrellgas to the risk of increased interest expense related to its variable rate borrowings.

Ferrellgas may enter into fair value hedges to help reduce its fixed interest rate risk. Interest rate swaps may be used to hedge the exposure to changes in the fair value of fixed rate debt due to changes in interest rates. Fixed rate debt that has been designated as being hedged is adjusted to offset the change in the fair value of interest rate derivatives that are fair value hedges, which are classified as “Prepaid expenses and other current assets”, “Other assets, net”, Other current liabilities” or as “Other liabilities” on the consolidated balance sheets. Changes in the fair value of fixed rate debt and any related fair value hedges are recognized as they occur in “Interest expense” on the consolidated statements of operations.

Ferrellgas may enter into cash flow hedges to help reduce its variable interest rate risk. Interest rate swaps are used to hedge the risk associated with rising interest rates and their effect on forecasted interest payments related to variable rate borrowings. These interest rate swaps are designated as cash flow hedges. Thus, the effective portions of changes in the fair value of the hedges are recorded in “Prepaid expenses and other current assets”, “Other assets, net”, “Other current liabilities” or as “Other liabilities” with an offsetting entry to “Other comprehensive income” at interim periods and are subsequently recognized as interest expense in the consolidated statement of operations when the forecasted transaction impacts earnings. Changes in the fair value of any cash flow hedges that are considered ineffective are recognized as interest expense on the consolidated statement of operations as they occur.

(11) Revenue recognition: Revenues from Ferrellgas’ propane operations and related equipment sales segment are recognized at the time product is delivered with payments generally due 30 days after receipt. Amounts are considered past due after 30 days. Ferrellgas determines accounts receivable allowances based on management’s assessment of the creditworthiness of the customers and other collection actions. Ferrellgas offers “even pay” billing programs that can create customer deposits or advances. Revenue is recognized from these customer deposits or advances to customers at the time product is delivered. Other revenues, which include revenue from the sale of propane appliances and equipment is recognized at the time of delivery or installation. Ferrellgas recognizes shipping and handling revenues and expenses for sales of propane, appliances and equipment at the time of delivery or installation. Shipping and handling revenues are included in the price of propane charged to customers, and are classified as revenue. Revenues from annually billed, non-refundable propane tank rentals are recognized in “Revenues: other” on a straight-line basis over one year.

Prior to the dispositions in 2018 which constituted Ferrellgas’ Midstream operations segment, revenues included crude oil sales, pipeline tariffs, trucking fees, rail throughput fees, pipeline management services, leasing, throughput, storage and salt water disposal. These revenues were recognized upon completion of the related service or delivery of product.

(12) Shipping and handling expenses: Shipping and handling expenses related to delivery personnel, vehicle repair and maintenance and general liability expenses are classified within “Operating expense” in the consolidated statements of operations. Depreciation expenses on delivery vehicles Ferrellgas owns are classified within “Depreciation and amortization expense.” Delivery vehicles and distribution technology leased by Ferrellgas are classified within “Equipment lease expense.”

See Note E – Supplemental financial statement information – for the financial statement presentation of shipping and handling expenses.

(13) Cost of sales: “Cost of sales – propane and other gas liquids sales” includes all costs to acquire propane and other gas liquids, the costs of storing and transporting inventory prior to delivery to Ferrellgas’ customers, the results from risk management activities to hedge related price risk and the costs of materials related to the refurbishment of Ferrellgas’ portable propane tanks. “Cost of sales - midstream operations” includes all costs incurred to purchase and transport crude oil, including the costs of terminaling and transporting crude oil prior to delivery to customers and the costs of salt water disposal. “Cost of sales – other” primarily includes costs related to the sale of propane appliances and equipment.

(14) Operating expense: “Operating expense” primarily includes the personnel, vehicle, delivery, handling, plant, office, selling, marketing, credit and collections and other expenses.

(15) General and administrative expenses: “General and administrative expense” primarily includes personnel and incentive expense related to executives and employees, as well as other overhead expenses related to centralized corporate functions.

(16) Stock-based plans:

Ferrell Companies, Inc. Incentive Compensation Plans (“ICPs”)

The ICPs are not Ferrellgas stock-compensation plans; however, in accordance with Ferrellgas’ partnership agreements, all Ferrellgas employee-related costs incurred by Ferrell Companies are allocated to Ferrellgas. As a result, Ferrellgas incurs a non-cash compensation charge from Ferrell Companies. During the years ended July 31, 2019, 2018 and 2017, the portion of the total non-cash compensation charge relating to the ICPs was $0.0 million, $0.0 million and $3.3 million, respectively. During fiscal 2019 there were no plan-based awards granted under the ICP and all outstanding SARs are currently valued at zero.

Ferrell Companies is authorized to issue up to 9.25 million stock appreciation rights (“SARs”) that are based on shares of Ferrell Companies common stock. The SARs were established by Ferrell Companies to allow upper-middle and senior level managers as well as directors of the general partner to participate in the equity growth of Ferrell Companies. The SARs awards vest ratably over periods ranging from zero to 10 years or 100% upon a change of control of Ferrell Companies, or upon the death, disability or retirement at the age of 65 of the participant. All awards expire 10 years from the date of issuance. The fair value of each award is estimated on each balance sheet date using a binomial valuation model.

(17) Income taxes: Ferrellgas Partners is a publicly-traded master limited partnership with one subsidiary that is a taxable corporation. The operating partnership is a limited partnership with three subsidiaries that are taxable corporations. Partnerships are generally not subject to federal income tax, although publicly-traded partnerships are treated as corporations for federal income tax purposes and therefore subject to Federal income tax unless a qualifying income test is satisfied. If this qualifying income test is satisfied, the publicly-traded partnership will be treated as a partnership for Federal income tax purposes. Based on Ferrellgas’ calculations, Ferrellgas Partners satisfies the qualifying income test. As a result, except for the taxable corporations, Ferrellgas Partners’ earnings or losses for Federal income tax purposes are included in the tax returns of the individual partners, Ferrellgas Partners’ unitholders. Accordingly, the accompanying consolidated financial statements of Ferrellgas Partners reflect federal income taxes related to the above mentioned taxable corporations and certain states that allow for income taxation of partnerships. Net earnings for financial statement purposes may differ significantly from taxable income reportable to Ferrellgas Partners unitholders as a result of differences between the tax basis and financial reporting basis of assets and liabilities, the taxable income allocation requirements under Ferrellgas Partners’ partnership agreement and differences between Ferrellgas Partners’ financial reporting fiscal year end and its calendar tax year end.

Income tax expense (benefit) consisted of the following:


	For the year ended July 31,
	2019		2018		2017
Current expense (benefit)	$	180	$	1,140	$	(1,154)
Deferred expense (benefit)		143		(3,818)		11
Income tax expense (benefit)	$	323	$	(2,678)	$	(1,143)

Deferred taxes consisted of the following:


	July 31,
	2019		2018
Deferred tax assets (included in Other assets, net)	$	631	$	715
Deferred tax liabilities (included in Other liabilities)		(76)		(16)
Net deferred tax asset	$	555	$	699

(18) Sales taxes: Ferrellgas accounts for the collection and remittance of sales tax on a net tax basis. As a result, these amounts are not reflected in the consolidated statements of operations.

(19) Net loss per common unitholders’ interest: Net loss per common unitholders’ interest is computed by dividing “Net loss attributable to Ferrellgas Partners, L.P.,” after deducting the general partner’s approximate 1% interest, by the weighted average number of outstanding common units and the dilutive effect, if any, of outstanding unit options. See Note P – Net loss per common unitholders’ interest – for further discussion about these calculations.

(20) Loss contingencies: In the normal course of business, Ferrellgas is involved in various claims and legal proceedings. Ferrellgas records a liability for such matters when it is probable that a loss has been incurred and the amounts can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. Legal costs associated with loss contingencies are expensed as incurred.

(21) New accounting standards:

FASB Accounting Standard Update No. 2014‑09

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update ("ASU") 2014‑09, Revenue from Contracts with Customers (“ASU 2014‑09”). The issuance is part of a joint effort by the FASB and the International Accounting Standards Board ("IASB") to enhance financial reporting by creating common revenue recognition guidance for U.S. GAAP and International Financial Reporting Standards ("IFRS") and, thereby, improving the consistency of requirements, comparability of practices and usefulness of disclosures. Upon adoption, Ferrellgas applied ASU 2014‑09 only to contracts that were not completed, referred to as open contracts.

Ferrellgas adopted ASU 2014‑09 beginning on August 1, 2018 using the modified retrospective method. This method requires that the cumulative effect of initially applying ASU 2014‑09 be recognized in partner’s deficit at the date of adoption, August 1, 2018. ASU 2014‑09 has not materially impacted Ferrellgas’ consolidated financial statements, and as a result there was no cumulative effect to record as of the date of adoption. Results for reporting periods beginning after August 1, 2018 are presented under ASU 2014-09, while amounts reported for prior periods have not been adjusted and continue to be reported under accounting standards in effect for those periods. See Note J - Revenue from contracts with customers for additional information related to revenues and contract costs, including qualitative and quantitative disclosures required under ASU 2014-09.

FASB Accounting Standard Update No. 2016‑02

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new standard requires lessees to apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. An entity may elect the transition relief option in ASU 2018-11, “Leases: Targeted Improvements” which, among other things, provides entities with an option to recognize the cumulative-effect adjustment from the modified retrospective application to the opening balance of retained earnings in the period of adoption and consequently, to continue to report comparative periods in compliance with the prior guidance (ASC 840). Ferrellgas expects to elect this additional transition method. Additionally, Ferrellgas currently expects to elect the short-term lease recognition exemption for all leases that qualify, meaning we would not recognize right-of-use assets or lease liabilities for those leases. We also currently expect to elect the practical expedient to not separate lease and non-lease components for our most significant leasing activity, which includes vehicle and real estate leases.

Ferrellgas is continuing to evaluate the impact of its pending adoption of ASU 2016-02 on the consolidated financial statements. Ferrellgas has made significant progress in assessing the impact of the standard and planning for the adoption and implementation. The implementation team has completed scoping and the data gathering process of our current lease portfolio. Ferrellgas continues to perform a completeness assessment over the lease population, analyze the financial statement impact of adopting the standards, and evaluate the impact of adoption on our existing accounting policies and disclosures. Further, our implementation team is in the process of determining appropriate changes to our business processes, systems, and controls to support recognition and disclosure under the new standard. Ferrellgas believes that the adoption of this standard, which will be effective for Ferrellgas August 1, 2019, will result in material increases to right-of-use assets and lease liabilities on our consolidated balance sheets and a corresponding change in classification of certain expenses contained on our consolidated statements of operations. On August 1, 2019, Ferrellgas expects to recognize additional operating lease liabilities ranging from $120 million to $140 million, with corresponding right-of-use assets based on the present value of the remaining minimum rental payments using preliminary estimates of discount rates. Ferrellgas does not believe the adoption of this standard will impact the compliance calculations for our debt covenants. Ferrellgas has not finalized the effects of these expected changes from the new standard.

FASB Accounting Standard Update No. 2016‑13

In June 2016, the FASB issued ASU 2016‑13, Financial Instruments - Credit Losses (Topic 326) which requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. Ferrellgas is currently evaluating the impact of its pending adoption of this standard on the consolidated financial statements.

FASB Accounting Standard Update No. 2017‑12

In August 2017, the FASB issued ASU 2017‑12, Financial Instruments - Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities, which is intended to improve the financial reporting for hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. Ferrellgas has made significant progress in assessing the impact of the standard and planning for the adoption and implementation. Ferrellgas believes that the adoption of this standard, which will be effective for Ferrellgas August 1, 2019, will result in additional disclosure related to the impact on the consolidated statement of operations for derivatives designated as hedging instruments. Ferrellgas has not finalized the effects of these expected changes from the new standard.

FASB Accounting Standard Update No. 2018‑15

In August 2018, the FASB issued ASU 2018‑15, Intangibles - Goodwill and Other - Internal-use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract which is intended to clarify the accounting for implementation costs related to a cloud computing arrangement that is a service contract. Costs for implementation activities in the application development stage are deferred, depending on the nature of the costs, while costs incurred during the preliminary project and post-implementation stages are expensed. Any deferred costs are amortized over the term of the service contract. The new guidance can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. Ferrellgas adopted ASU 2018-15 on a prospective basis to all implementation costs incurred after January 31, 2019 with an immaterial impact on our consolidated results of operations for the six months ended July 31, 2019.

Summary Of Significant Accounting Policies

B. Summary of significant accounting policies

(1)

Accounting estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from these estimates. Significant estimates impacting the consolidated financial statements include accruals that have been established for contingent liabilities, pending claims and legal actions arising in the normal course of business, useful lives of property, plant and equipment, residual values of tanks, capitalization of customer tank installation costs, amortization methods of intangible assets, valuation methods used to value sales returns and allowances, allowance for doubtful accounts, fair value of reporting units, recoverability of long-lived assets, assumptions used to value business combinations, fair values of derivative contracts and stock-based compensation calculations.

(2)

Principles of consolidation: The accompanying consolidated financial statements present the consolidated financial position, results of operations and cash flows of Ferrellgas, L.P. and its subsidiaries after elimination of all intercompany accounts and transactions. Ferrellgas, L.P. consolidates the following wholly-owned entities: Bridger Logistics, LLC, Sable Environmental, LLC, Sable SWD 2, LLC, Blue Rhino Global Sourcing, Inc., Blue Rhino Canada, Inc., Ferrellgas Real Estate, Inc., Ferrellgas Finance Corp. and Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), a special purpose entity that has agreements with Ferrellgas, L.P. to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Certain prior-year amounts have been reclassified to conform to the current-year presentation.

(3)

Fair value measurements: Ferrellgas, L.P. measures certain of its assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants – in either the principal market or the most advantageous market. The principal market is the market with the greatest level of activity and volume for the asset or liability.

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

(4)

Accounts receivable: Accounts receivable are reported on the consolidated balance sheets at the gross outstanding amount adjusted for an allowance for doubtful accounts. Accounts receivable that are acquired are initially recorded at fair value on the date of acquisition. Provisions for uncollectible accounts are established based upon our collection experience and the assessment of the collectability of specific amounts. Accounts receivable are written off in the period in which the receivable is deemed uncollectible.

(5)

Accounts receivable securitization: Through its wholly-owned and consolidated subsidiary Ferrellgas Receivables, Ferrellgas, L.P. has agreements to securitize, on an ongoing basis, a portion of its trade accounts receivable.

(6)

Inventories: Inventories are stated at the lower of cost or net realizable value using weighted average cost and actual cost methods.

(7)

Property, plant and equipment: Property, plant and equipment are stated at cost less accumulated depreciation. Expenditures for maintenance and routine repairs are expensed as incurred. Ferrellgas, L.P. capitalizes computer software, equipment replacement and betterment expenditures that upgrade, replace or completely rebuild major mechanical components and extend the original useful life of the equipment. Depreciation is calculated using the straight-line method based on the estimated useful lives of the assets ranging from two to 30 years. Ferrellgas, L.P., using its best estimates based on reasonable and supportable assumptions and projections, tests long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of its assets or asset groups might not be recoverable. The recoverability tests for property, plant and equipment are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas, L.P. management’s plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

(8)

Goodwill: Ferrellgas, L.P. records goodwill as the excess of the cost of acquisitions over the fair value of the related net assets at the date of acquisition. Ferrellgas, L.P. tests goodwill for impairment annually during the second quarter or more frequently if events or changes in circumstances indicate that it is more likely than not the fair value of a reporting unit is less than the carrying value. Ferrellgas, L.P. has determined that it has two reporting units for goodwill impairment testing purposes. As of July 31, 2019, one of these reporting units contains goodwill that is subject to at least an annual assessment for impairment by applying a fair-value-based test. Under this test, the carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units as of the date of the evaluation on a specific identification basis. To the extent a reporting unit’s carrying value exceeds its fair value, the reporting unit’s goodwill is impaired. The amount of impairment would be equal to the lesser of the excess of reporting unit carrying value over its fair value and the reporting unit’s recorded amount of goodwill. Ferrellgas, L.P. completed its most recent annual goodwill impairment test on January 31, 2019 and did not incur an impairment loss. For fiscal 2018, the test was performed on January 31, 2018 and an impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment was recorded.

(9)

Intangible assets: Intangible assets with finite useful lives, consisting primarily of customer related assets and non-compete agreements, permits, favorable lease arrangements and patented technology are stated at cost, net of accumulated amortization calculated using the straight-line method over periods ranging from two to 15 years. When necessary, intangible assets’ useful lives are revised and the impact on amortization reflected on a prospective basis. Trade names and trademarks have indefinite lives, are not amortized, and are stated at cost. Ferrellgas, L.P. tests finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of these assets or asset groups might not be recoverable. Ferrellgas, L.P. tests indefinite-lived intangible assets for impairment annually on January 31 or more frequently if circumstances dictate. The recoverability tests for definite-lived intangible assets are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas, L.P. management’s plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

(10)

Derivative instruments and hedging activities:

Commodity and Transportation Fuel Price Risk.

Ferrellgas, L.P.’s overall objective for entering into commodity based derivative contracts, including commodity options and swaps, is to hedge a portion of its exposure to market fluctuations in propane, gasoline and diesel prices.

Ferrellgas, L.P’s risk management activities primarily attempt to mitigate price risks related to the purchase, storage, transport and sale of propane generally in the contract and spot markets from major domestic energy companies on a short-term basis. Ferrellgas, L.P attempts to mitigate these price risks through the use of financial derivative instruments and forward propane purchase and sales contracts. Additionally, from time to time Ferrellgas, L.P.’s risk management activities attempt to mitigate price risks related to the purchase of gasoline and diesel fuel for use in the transport of propane from retail fueling stations through the use of financial derivative instruments.

Ferrellgas, L.P.’s risk management strategy involves taking positions in the forward or financial markets that are equal and opposite to Ferrellgas, L.P.’s positions in the physical products market in order to minimize the risk of financial loss from an adverse price change. This risk management strategy is successful when Ferrellgas, L.P.’s gains or losses in the physical product markets are offset by its losses or gains in the forward or financial markets. These propane related financial derivatives are designated as cash flow hedges. The gasoline and diesel related financial derivatives have not historically been formally designated and documented as a hedge of exposure to fluctuations in the market price of fuel.

Ferrellgas, L.P.’s risk management activities may include the use of financial derivative instruments including, but not limited to, futures, swaps, and options to seek protection from adverse price movements and to minimize potential losses. Ferrellgas, L.P. enters into these financial derivative instruments primarily with brokers who are clearing members with the Intercontinental Exchange or the Chicago Mercantile Exchange and, to a lesser extent, directly with third parties in the over-the-counter market. All of Ferrellgas, L.P.’s financial derivative instruments are reported on the consolidated balance sheets at fair value.

Ferrellgas, L.P. also enters into forward propane purchase and sales contracts with counterparties. These forward contracts qualify for the normal purchase normal sales exception within GAAP guidance and are therefore not recorded on Ferrellgas, L.P.’s financial statements until settled.

On the date that derivative contracts are entered into, other than those designated as normal purchases or normal sales, Ferrellgas, L.P. makes a determination as to whether the derivative instrument qualifies for designation as a hedge. These financial instruments are formally designated as a hedge of a specific underlying exposure and that designation, as well as the risk management objectives and strategies for undertaking the hedge transaction are documented. Because of the high degree of correlation between the hedging instrument and the underlying exposure being hedged, fluctuations in the value of the derivative instrument are generally offset by changes in the anticipated cash flows of the underlying exposure being hedged. Since the fair value of these derivatives fluctuates over their contractual lives, their fair value amounts should not be viewed in isolation, but rather in relation to the anticipated cash flows of the underlying hedged transaction and the overall reduction in Ferrellgas, L.P.’s risk relating to adverse fluctuations in propane prices. Ferrellgas, L.P. formally assesses, both at inception and at least quarterly thereafter, whether the financial instruments that are used in hedging transactions are effective at offsetting changes in the anticipated cash flows of the related underlying exposures. Any ineffective portion of a financial instrument’s change in fair value is recognized in “Cost of product sold - propane and other gas liquids sales” in the consolidated statements of operations. Financial instruments formally designated and documented as a hedge of a specific underlying exposure are recorded gross at fair value as either “Prepaid expenses and other current assets”, “Other assets, net”, “Other current liabilities” or “Other liabilities” on the consolidated balance sheets with changes in fair value reported in other comprehensive income.

Interest Rate Risk.

Fluctuations in interest rates subject Ferrellgas, L.P. to interest rate risk. Decreases in interest rates increase the fair value of Ferrellgas, L.P.’s fixed rate debt, while increases in interest rates subject Ferrellgas, L.P. to the risk of increased interest expense related to its variable rate borrowings.

Ferrellgas, L.P. may enter into fair value hedges to help reduce its fixed interest rate risk. Interest rate swaps may be used to hedge the exposure to changes in the fair value of fixed rate debt due to changes in interest rates. Fixed rate debt that has been designated as being hedged is adjusted to offset the change in the fair value of interest rate derivatives that are fair value hedges, which are classified as “Prepaid expenses and other current assets”, “Other assets, net”, Other current liabilities” or as “Other liabilities” on the consolidated balance sheets. Changes in the fair value of fixed rate debt and any related fair value hedges are recognized as they occur in “Interest expense” on the consolidated statements of operations.

Ferrellgas, L.P. may enter into cash flow hedges to help reduce its variable interest rate risk. Interest rate swaps are used to hedge the risk associated with rising interest rates and their effect on forecasted interest payments related to variable rate borrowings. These interest rate swaps are designated as cash flow hedges. Thus, the effective portions of changes in the fair value of the hedges are recorded in “Prepaid expenses and other current assets”, “Other assets, net”, “Other current liabilities” or as “Other liabilities” with an offsetting entry to ”Other comprehensive income” at interim periods and are subsequently recognized as interest expense in the consolidated statement of operations when the forecasted transaction impacts earnings. Changes in the fair value of any cash flow hedges that are considered ineffective are recognized as interest expense on the consolidated statements of operations as they occur.

(11)

Revenue recognition: Revenues from Ferrellgas, L.P.’s propane operations and related equipment sales segment are recognized at the time product is delivered with payments generally due 30 days after receipt. Amounts are considered past due after 30 days. Ferrellgas, L.P. determines accounts receivable allowances based on management’s assessment of the creditworthiness of the customers and other collection actions. Ferrellgas, L.P. offers “even pay” billing programs that can create customer deposits or advances. Revenue is recognized from these customer deposits or advances to customers at the time product is delivered. Other revenues, which include revenue from the sale of propane appliances and equipment is recognized at the time of delivery or installation. Ferrellgas, L.P. recognizes shipping and handling revenues and expenses for sales of propane, appliances and equipment at the time of delivery or installation. Shipping and handling revenues are included in the price of propane charged to customers, and are classified as revenue. Revenues from annually billed, non-refundable propane tank rentals are recognized in “Revenues: other” on a straight-line basis over one year.

Prior to the dispositions in 2018 which constituted Ferrellgas, L.P.’s Midstream operations segment, revenues included crude oil sales, pipeline tariffs, trucking fees, rail throughput fees, pipeline management services, leasing, throughput, storage and salt water disposal. These revenues were recognized upon completion of the related service or delivery of product.

(12)

Shipping and handling expenses: Shipping and handling expenses related to delivery personnel, vehicle repair and maintenance and general liability expenses are classified within “Operating expense” in the consolidated statements of operations. Depreciation expenses on delivery vehicles Ferrellgas, L.P. owns are classified within “Depreciation and amortization expense.” Delivery vehicles and distribution technology leased by Ferrellgas, L.P. are classified within “Equipment lease expense.”

See Note E – Supplemental financial statement information – for the financial statement presentation of shipping and handling expenses.

(13)

Cost of sales: “Cost of sales – propane and other gas liquids sales” includes all costs to acquire propane and other gas liquids, the costs of storing and transporting inventory prior to delivery to Ferrellgas, L.P.’s customers, the results from risk management activities to hedge related price risk and the costs of materials related to the refurbishment of Ferrellgas, L.P.’s portable propane tanks. “Cost of sales - midstream operations” includes all costs incurred to purchase and transport crude oil, including the costs of terminaling and transporting crude oil prior to delivery to customers and the costs of salt water disposal. “Cost of sales – other” primarily includes costs related to the sale of propane appliances and equipment.

(14)

Operating expenses: “Operating expense” primarily includes the personnel, vehicle, delivery, handling, plant, office, selling, marketing, credit and collections and other expenses.

(15)

General and administrative expenses: “General and administrative expense” primarily includes personnel and incentive expense related to executives and employees, as well as other overhead expenses related to centralized corporate functions.

(16)

Stock-based plans:

Ferrell Companies, Inc. Incentive Compensation Plans (“ICPs”)

The ICPs are not Ferrellgas, L.P. stock-compensation plans; however, in accordance with Ferrellgas, L.P.’s partnership agreements, all Ferrellgas, L.P. employee-related costs incurred by Ferrell Companies are allocated to Ferrellgas, L.P. As a result, Ferrellgas, L.P. incurs a non-cash compensation charge from Ferrell Companies. During the years ended July 31, 2019, 2018 and 2017, the portion of the total non-cash compensation charge relating to the ICPs was $0.0 million, $0.0 million and $3.3 million, respectively. During fiscal 2019 there were no plan-based awards granted under the ICP and all outstanding SARs are currently valued at zero.

(17)

Income taxes: Ferrellgas, L.P. is a limited partnership and owns three subsidiaries that are taxable corporations. As a result, except for the taxable corporations, Ferrellgas, L.P.’s earnings or losses for federal income tax purposes are included in the tax returns of the individual partners. Accordingly, the accompanying consolidated financial statements of Ferrellgas, L.P. reflect federal income taxes related to the above mentioned taxable corporations and certain states that allow for income taxation of partnerships. Net earnings for financial statement purposes may differ significantly from taxable income reportable to partners as a result of differences between the tax basis and financial reporting basis of assets and liabilities, the taxable income allocation requirements under Ferrellgas, L.P.’s partnership agreement and differences between Ferrellgas, L.P.’s financial reporting fiscal year end and limited partners tax year end.

Income tax expense (benefit) consisted of the following:


	For the year ended July 31,
	2019		2018		2017
Current expense (benefit)	$	150	$	1,119	$	(1,160)
Deferred expense (benefit)		143		(3,818)		11
Income tax expense (benefit)	$	293	$	(2,699)	$	(1,149)

Deferred taxes consisted of the following:


	July 31,
	2019		2018
Deferred tax assets (included in Other assets, net)	$	631	$	715
Deferred tax liabilities (included in Other liabilities)		(76)		(16)
Net deferred tax asset	$	555	$	699

(18)

Sales taxes: Ferrellgas, L.P. accounts for the collection and remittance of sales tax on a net tax basis. As a result, these amounts are not reflected in the consolidated statements of operations.

(19)

Loss contingencies: In the normal course of business, Ferrellgas, L.P. is involved in various claims and legal proceedings. Ferrellgas, L.P. records a liability for such matters when it is probable that a loss has been incurred and the amounts can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. Legal costs associated with loss contingencies are expensed as incurred.

(20)

New accounting standards:

FASB Accounting Standard Update No. 2014‑09

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update ("ASU") 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The issuance is part of a joint effort by the FASB and the International Accounting Standards Board ("IASB") to enhance financial reporting by creating common revenue recognition guidance for U.S. GAAP and International Financial Reporting Standards ("IFRS") and, thereby, improving the consistency of requirements, comparability of practices and usefulness of disclosures. Upon adoption, Ferrellgas, L.P. applied ASU 2014-09 only to contracts that were not completed, referred to as open contracts.

Ferrellgas, L.P. adopted ASU 2014-09 beginning on August 1, 2018 using the modified retrospective method. This method requires that the cumulative effect of initially applying ASU 2014-09 be recognized in partner’s deficit at the date of adoption, August 1, 2018. ASU 2014-09 has not materially impacted Ferrellgas, L.P.’s consolidated financial statements, and as a result there was no cumulative effect to record as of the date of adoption. Results for reporting periods beginning after August 1, 2018 are presented under ASU 2014-09, while amounts reported for prior periods have not been adjusted and continue to be reported under accounting standards in effect for those periods. See Note J - Revenue from contracts with customers for additional information related to revenues and contract costs, including qualitative and quantitative disclosures required under ASU 2014-09.

FASB Accounting Standard Update No. 2016‑02

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new standard requires lessees to apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. An entity may elect the transition relief option in ASU 2018-11, “Leases: Targeted Improvements” which, among other things, provides entities with an option to recognize the cumulative-effect adjustment from the modified retrospective application to the opening balance of retained earnings in the period of adoption and consequently, continue to report comparative periods in compliance with the prior guidance (ASC 840). Ferrellgas, L.P. expects to elect this additional transition method. Additionally, Ferrellgas, L.P. currently expects to elect the short-term lease recognition exemption for all leases that qualify, meaning we would not recognize right-of-use assets or lease liabilities for those leases. We also currently expect to elect the practical expedient to not separate lease and non-lease components for our most significant leasing activity, which includes vehicle and real estate leases.

Ferrellgas, L.P. is continuing to evaluate the impact of its pending adoption of ASU 2016-02 on the consolidated financial statements. Ferrellgas, L.P. has made significant progress in assessing the impact of the standard and planning for the adoption and implementation. The implementation team has completed scoping and the data gathering process of our current lease portfolio. Ferrellgas, L.P. continues to perform a completeness assessment over the lease population, analyze the financial statement impact of adopting the standards, and evaluate the impact of adoption on our existing accounting policies and disclosures. Further, our implementation team is in the process of determining appropriate changes to our business processes, systems, and controls to support recognition and disclosure under the new standard. Ferrellgas, L.P. believes that the adoption of this standard, which will be effective for Ferrellgas, L.P. August 1, 2019, will result in material increases to right-of-use assets and lease liabilities on our consolidated balance sheets and a corresponding change in classification of certain expenses contained on our consolidated statements of operations. On August 1, 2019, Ferrellgas, L.P. expects to recognize additional operating lease liabilities ranging from $120 million to $140 million, with corresponding right-of-use assets based on the present value of the remaining minimum rental payments using preliminary estimates of discount rates. Ferrellgas, L.P. does not believe the adoption of this standard will impact the compliance calculations for our debt covenants. Ferrellgas, L.P. has not finalized the effects of these expected changes from the new standard.

FASB Accounting Standard Update No. 2016‑13

In June 2016, the FASB issued ASU 2016‑13, Financial Instruments - Credit Losses (Topic 326), which requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. Ferrellgas, L.P. is currently evaluating the impact of its pending adoption of this standard on the consolidated financial statements.

FASB Accounting Standard Update No. 2017‑12

In August 2017, the FASB issued ASU 2017‑12, Financial Instruments - Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities , which is intended to improve the financial reporting for hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. Ferrellgas, L.P. believes that the adoption of this standard, which will be effective for Ferrellgas, L.P. August 1, 2019, will result in additional disclosure related to the impact on the consolidated statement of operations for derivatives designated as hedging instruments. Ferrellgas, L.P. has not finalized the effects of these expected changes from the new standard.

FASB Accounting Standard Update No. 2018-15

In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract which is intended to clarify the accounting for implementation costs related to a cloud computing arrangement that is a service contract. Costs for implementation activities in the application development stage are deferred, depending on the nature of the costs, while costs incurred during the preliminary project and post-implementation stages are expensed. Any deferred costs are amortized over the term of the service contract. The new guidance can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. Ferrellgas, L.P. adopted ASU 2018-15 on a prospective basis to all implementation costs incurred after January 31, 2019 with an immaterial impact on our consolidated results of operations for the six months ended July 31, 2019.

Acquisitions, dispositions and other significant transactions

12 Months Ended

Jul. 31, 2019

Business Combinations

C. Acquisitions, dispositions and other significant transactions

Acquisitions

Business combinations are accounted for under the acquisition method of accounting and the assets acquired and liabilities assumed are recorded at their estimated fair market values as of the acquisition dates. The results of operations are included in the consolidated statements of operations from the date of acquisition. The pro forma effect of these transactions was not material to Ferrellgas’ balance sheets or results of operations.

Propane operations and related equipment sales

During fiscal 2019, Ferrellgas acquired propane distribution assets, primarily of independent distributors, with an aggregate value of $15.2 million in the following transactions:

Salathe Gas Co., based in Louisiana, acquired September 2018;

North Star Exchange, Inc., based in Indiana, acquired October 2018;

Wylie LP Gas Inc., based in Texas, acquired October 2018;

Co-op Butane Inc., based in Louisiana, acquired in December 2018;

American Propane, based in Oklahoma, acquired January 2019;

Reliable Propane Inc., based in Missouri, acquired in February 2019;

AAA Propane, Inc., based in Colorado, acquired in June 2019.

During fiscal 2018, Ferrellgas acquired propane distribution assets with an aggregate value of $20.6 million in the following transactions:

Lindsey Propane LLC, based in Tennessee, acquired August 2017;

Sevier County Propane, based in Tennessee, acquired August 2017;

Service Plus Propane, Inc., based in Virginia, acquired September 2017;

Tapper Propane, Inc., based in Michigan, acquired November 2017; and

Diamond Propane LLC, based in New York, acquired June 2018.

During fiscal 2017, Ferrellgas acquired propane distribution assets of Valley Center Propane, based in California, with an aggregate value of $4.4 million.

These acquisitions were funded as follows on their dates of acquisition:


	For the year ended July 31,
	2019		2018		2017
Cash payments, net of cash acquired	$	13,551	$	18,141	$	3,539
Issuance of liabilities and other costs and considerations		1,650		2,426		856
Aggregate fair value of transactions	$	15,201	$	20,567	$	4,395

The aggregate fair values, for the acquisitions in propane operations and related equipment sales reporting segment, were allocated as follows, including any adjustments identified during the measurement period:


	For the year ended July 31,
	2019		2018		2017
Working capital	$	31	$	758	$	139
Customer tanks, buildings, land and other		11,560		10,022		1,220
Goodwill		1,410		—		—
Customer lists		1,272		7,758		2,648
Non-compete agreements		928		2,029		388
Aggregate fair value of net assets acquired	$	15,201	$	20,567	$	4,395

The estimated fair values and useful lives of assets acquired during fiscal 2019 are based on a preliminary valuation and are subject to final valuation adjustments. Ferrellgas intends to continue its analysis of the net assets of these transactions to determine the final allocation of the total purchase price to the various assets and liabilities acquired. The estimated fair values and useful lives of assets acquired during fiscal 2018 and 2017 are based on internal valuations and included only minor adjustments during the 12 month period after the date of acquisition. Due to the immateriality of these adjustments, Ferrellgas did not retrospectively adjust the consolidated statements of operations for those measurement period adjustments.

Dispositions

Propane operations and related equipment sales

During July 2018, Ferrellgas completed the sale of a group of assets encompassing an immaterial reporting unit within our Propane operations segment for approximately $26.6 million in cash. For the year ended July 31, 2018, “Loss on asset sales and disposals” includes a loss of $15.2 million related to this sale. The assets sold consist primarily of working capital and equipment.

Midstream operations

During July 2018, Ferrellgas completed the sale of a subsidiary and a group of assets within the Midstream operations segment for approximately $57.0 million in cash. The subsidiary sold was Bridger Environmental LLC, which encompasses all saltwater disposal activities previously operated by Ferrellgas. The group of assets sold includes all assets, excluding working capital, associated with the crude oil trucking operations previously operated by Ferrellgas. Additionally, the sale included two crude oil injection terminals. In separate transactions, the remaining assets of the Bridger Terminal business were sold to various parties. The largest of these assets, the Swan Ranch Terminal, was sold for $8.0 million in cash. For the year ended July 31, 2018, “Loss on asset sales and disposals” includes a loss of $120.2 million related to these sales.

Additionally, during fiscal 2018, Ferrellgas sold all 1,292 rail cars utilized in the Midstream operations segment for approximately $51.3 million in cash. For the year ended July 31, 2018, “Loss on asset sales and disposals” includes a loss of $36.8 million related to the sale of these rail cars. Proceeds from the transaction were used to reduce outstanding debt on Ferrellgas’ previous senior secured credit facility. During fiscal 2018, Ferrellgas completed the sale of Bridger Energy, LLC, included in the Midstream operations segment, in exchange for an $8.5 million secured promissory note due in May 2020 which was fully paid on February 20, 2019. For the year ended July 31, 2018, “Loss on asset sales and disposals” includes a loss of $4.0 million related to this sale.

The combined results from operations of these various Midstream dispositions in our Consolidated Statements of Operations includes losses before income taxes for the years ended July 31, 2018 and 2017 of $55.4 million and $62.2 million, respectively. The combined losses before income taxes attributable to Ferrellgas Partners, L.P. for the years ended July 31, 2018 and 2017 was $54.8 million and $61.6 million, respectively.

“Loss on asset sales and disposals” consists of:


	For the year ended July 31,
	2019		2018		2017
Loss on sale of:
Propane-related accessories reporting unit	$	—	$	15,194	$	—
Midstream trucking, water disposal & terminal assets		2,679		120,240		—
Midstream railcars		—		36,762		—
Bridger Energy		—		4,002		—
Other		8,289		11,201		14,457
Loss on asset sales and disposals	$	10,968	$	187,399	$	14,457

Supplemental Financial Statement Information [Line Items]

Business Combinations

C. Acquisitions, dispositions and other significant transactions

Acquisitions

Propane operations and related equipment sales

During fiscal 2019, Ferrellgas acquired propane distribution assets, primarily of independent distributors, with an aggregate value of $15.2 million in the following transactions:

Salathe Gas Co., based in Louisiana, acquired September 2018;

North Star Exchange, Inc., based in Indiana, acquired October 2018;

Wylie LP Gas Inc., based in Texas, acquired October 2018;

Co-op Butane Inc., based in Louisiana, acquired in December 2018;

American Propane, based in Oklahoma, acquired January 2019;

Reliable Propane Inc., based in Missouri, acquired in February 2019;

AAA Propane, Inc., based in Colorado, acquired in June 2019.

During fiscal 2018, Ferrellgas, L.P. acquired propane distribution assets with an aggregate value of $20.6 million in the following transactions:

Lindsey Propane LLC, based in Tennessee, acquired August 2017;

Sevier County Propane, based in Tennessee, acquired August 2017;

Service Plus Propane, Inc., based in Virginia, acquired September 2017;

Tapper Propane, Inc., based in Michigan, acquired November 2017; and

Diamond Propane LLC, based in New York, acquired June 2018.

During fiscal 2017, Ferrellgas, L.P. acquired propane distribution assets of Valley Center Propane, based in California, with an aggregate value of $4.4 million.

These acquisitions were funded as follows on their dates of acquisition:


	For the year ended July 31,
	2019		2018		2017
Cash payments, net of cash acquired	$	13,551	$	18,141	$	3,539
Issuance of liabilities and other costs and considerations		1,650		2,426		856
Aggregate fair value of transactions	$	15,201	$	20,567	$	4,395


	For the year ended July 31,
	2019		2018		2017
Working capital		31		758		139
Customer tanks, buildings, land and other		11,560		10,022		1,220
Goodwill		1,410		—		—
Customer lists		1,272		7,758		2,648
Non-compete agreements		928		2,029		388
Aggregate fair value of net assets acquired	$	15,201	$	20,567	$	4,395

The estimated fair values and useful lives of assets acquired during fiscal 2019 are based on a preliminary valuation and are subject to final valuation adjustments. Ferrellgas, L.P. intends to continue its analysis of the net assets of these transactions to determine the final allocation of the total purchase price to the various assets and liabilities acquired. The estimated fair values and useful lives of assets acquired during fiscal 2018 and 2017 are based on internal valuations and included only minor adjustments during the 12 month period after the date of acquisition. Due to the immateriality of these adjustments, Ferrellgas, L.P. did not retrospectively adjust the consolidated statements of operations for those measurement period adjustments.

Dispositions

Propane operations and related equipment sales

During July 2018, Ferrellgas, L.P. completed the sale of a group of assets encompassing an immaterial reporting unit within our Propane operations segment for approximately $26.6 million in cash. For the year ended July 31, 2018, “Loss on asset sales and disposals” includes a loss of $15.2 million related to this sale. The assets sold consist primarily of working capital and equipment.

Midstream operations

During July 2018, Ferrellgas, L.P. completed the sale of a subsidiary and a group of assets within the Midstream operations segment for approximately $57.0 million in cash. The subsidiary sold was Bridger Environmental LLC, which encompasses all saltwater disposal activities previously operated by Ferrellgas Partners. The group of assets sold includes all assets, excluding working capital, associated with the crude oil trucking operations previously operated by Ferrellgas Partners. Additionally, the sale included two crude oil injection terminals. In separate transactions, the remaining assets of the Bridger Terminal business were sold to various parties. The largest of these assets, the Swan Ranch Terminal, was sold for $8.0 million in cash. For the year ended July 31, 2018, “Loss on asset sales and disposals” includes a loss of $120.2 million related to these sales.

Additionally, during fiscal 2018, Ferrellgas, L.P. sold all 1,292 rail cars utilized in the Midstream operations segment for approximately $51.3 million in cash. For the year ended July 31, 2018, “Loss on asset sales and disposals” includes a loss of $36.8 million related to the sale of these rail cars. Proceeds from the transaction were used to reduce outstanding debt on Ferrellgas L.P.’s previous senior secured credit facility. During fiscal 2018, Ferrellgas, L.P. completed the sale of Bridger Energy, LLC, included in the Midstream operations segment, in exchange for an $8.5 million secured promissory note due in May 2020 which was fully paid on February 20, 2019. For the year ended July 31, 2018, “Loss on asset sales and disposals” includes a loss of $4.0 million related to this sale.

The combined results from operations of these various Midstream dispositions in our Consolidated Statements of Operations includes losses before income taxes for the years ended July 31, 2018 and 2017 of $55.4 million and $62.2 million, respectively. The combined losses before income taxes attributable to Ferrellgas for the years ended July 31, 2018 and 2017 was $54.8 million and $61.6 million, respectively.

“Loss on asset sales and disposals” consists of:


	For the year ended July 31,
	2019		2018		2017
Loss on sale of:
Propane-related accessories reporting unit	$	—	$	15,194	$	—
Midstream trucking, water disposal & terminal assets		2,679		120,240		—
Midstream railcars		—		36,762		—
Bridger Energy		—		4,002		—
Other		8,289		11,201		14,457
Loss on asset sales and disposals	$	10,968	$	187,399	$	14,457

Quarterly Distributions Of Available Cash	12 Months Ended
Quarterly Distributions Of Available Cash	Jul. 31, 2019
Earnings Distribution Allocation [Line Items]
Quarterly Distributions Of Available Cash	D. Quarterly distribution of available cash To the extent it is not precluded from doing so by a debt covenant or other restriction, Ferrellgas Partners makes quarterly cash distributions of all of its “available cash.” Available cash is defined in the partnership agreement of Ferrellgas Partners as, generally, the sum of its consolidated cash receipts less consolidated cash disbursements and net changes in reserves established by the general partner for future requirements. Reserves are retained in order to provide for the proper conduct of Ferrellgas Partners’ business, or to provide funds for distributions with respect to any one or more of the next four fiscal quarters. Distributions are made within 45 days after the end of each fiscal quarter ending October, January, April and July to holders of record on the applicable record date. Currently, Ferrellgas Partners is not permitted, pursuant to the restricted payments covenant under its indenture, to make restricted payments, including distributions to common unitholders. See Note H – Debt for further discussion. Any distributions by Ferrellgas Partners in an amount equal to 100% of its available cash, as defined in its partnership agreement, will be made to the common unitholders and the general partner. Additionally, the payment of incentive distributions to the holders of incentive distribution rights will be made to the extent that certain target levels of cash distributions are achieved.
Ferrellgas, L.P. [Member]
Earnings Distribution Allocation [Line Items]
Quarterly Distributions Of Available Cash	D. Quarterly distribution of available cash To the extent it is not precluded from doing so by a debt covenant or other restriction, Ferrellgas, L.P. makes quarterly cash distributions of all of its “available cash.” Available cash is defined in the partnership agreement of Ferrellgas, L.P. as, generally, the sum of its consolidated cash receipts less consolidated cash disbursements and net changes in reserves established by the general partner for future requirements. Reserves are retained in order to provide for the proper conduct of Ferrellgas, L.P.’s business, or to provide funds for distributions with respect to any one or more of the next four fiscal quarters. Distributions are made within 45 days after the end of each fiscal quarter ending October, January, April and July. Any distributions by Ferrellgas, L.P. in an amount equal to 100% of its available cash, as defined in its partnership agreement, will be made approximately 99% to Ferrellgas Partners and approximately 1% to the general partner. See Note H – Debt for additional disclosures related to Ferrellgas, L.P.’s ability to make quarterly cash distributions.

Supplemental Financial Statement Information

12 Months Ended

Jul. 31, 2019

Supplemental Financial Statement Information

E. Supplemental financial statement information

Inventories consist of the following:


	July 31, 2019		July 31, 2018
Propane gas and related products	$	66,001	$	71,180
Appliances, parts and supplies, and other		14,453		12,514
Inventories	$	80,454	$	83,694

In addition to inventories on hand, Ferrellgas enters into contracts to take delivery of propane for supply procurement purposes with terms that generally do not exceed 36 months. Most of these contracts call for payment based on market prices at the date of delivery. As of July 31, 2019, Ferrellgas had committed, for supply procurement purposes, to take delivery of approximately 2.3 million gallons of propane at fixed prices.

Property, plant and equipment, net consist of the following:


	Estimated useful lives	July 31, 2019		July 31, 2018
Land	Indefinite	$	35,165	$	33,719
Land improvements	2-20		14,149		13,361
Buildings and improvements	20		86,444		71,612
Vehicles, including transport trailers	8-20		111,283		85,893
Bulk equipment and district facilities	5-30		109,751		103,627
Tanks, cylinders and customer equipment	2-30		779,827		769,165
Computer and office equipment	2-5		111,838		109,346
Construction in progress	n/a		7,061		14,394
			1,255,518		1,201,117
Less: accumulated depreciation			658,795		643,394
Property, plant and equipment, net		$	596,723	$	557,723

Depreciation expense totaled $60.7 million, $67.1 million and $68.1 million for fiscal 2019, 2018 and 2017, respectively.

Prepaid expenses and other current assets consist of the following:


	July 31, 2019		July 31, 2018
Broker margin deposit assets	$	25,028	$	2,851
Other		17,247		32,011
Prepaid expenses and other current assets	$	42,275	$	34,862

Other assets, net consist of the following:


	July 31, 2019		July 31, 2018
Notes receivable, less current portion	$	16,216	$	27,491
Other		52,889		47,097
Other assets, net	$	69,105	$	74,588

Other current liabilities consist of the following:


	July 31, 2019		July 31, 2018
Accrued interest	$	20,484	$	22,222
Customer deposits and advances		24,686		22,829
Accrued payroll		17,356		16,060
Accrued insurance		18,524		15,100
Price risk management liabilities		14,198		1,832
Other		42,989		61,580
Other current liabilities	$	138,237	$	139,623

Shipping and handling expenses are classified in the following consolidated statements of operations line items:


	For the year ended July 31,
	2019		2018		2017
Operating expense	$	215,780	$	195,646	$	175,164
Depreciation and amortization expense		6,375		4,947		3,909
Equipment lease expense		30,759		25,765		26,299
	$	252,914	$	226,358	$	205,372

For purposes of the consolidated statements of cash flows, Ferrellgas considers cash equivalents to include all highly liquid debt instruments purchased with an original maturity of three months or less. Certain cash flow and significant non-cash activities are presented below:


	For the year ended July 31,
	2019		2018		2017
Cash paid (refunded) for:
Interest	$	166,897	$	159,271	$	143,441
Income taxes	$	141	$	(291)	$	310
Non-cash investing and financing activities:
Liabilities incurred in connection with acquisitions	$	1,650	$	1,993	$	139
Change in accruals for property, plant and equipment additions	$	1,132	$	264	$	164

Supplemental Financial Statement Information [Line Items]

Supplemental Financial Statement Information

E. Supplemental financial statement information

Inventories consist of the following:


	July 31, 2019		July 31, 2018
Propane gas and related products	$	66,001	$	71,180
Appliances, parts and supplies, and other		14,453		12,514
Inventories	$	80,454	$	83,694

In addition to inventories on hand, Ferrellgas, L.P. enters into contracts to take delivery of propane for supply procurement purposes with terms that generally do not exceed 36 months. Most of these contracts call for payment based on market prices at the date of delivery. As of July 31, 2019, Ferrellgas, L.P. had committed, for supply procurement purposes, to take delivery of approximately 2.3 million gallons of propane at fixed prices.

Property, plant and equipment, net consist of the following:


	Estimated useful lives	July 31, 2019		July 31, 2018
Land	Indefinite	$	35,165	$	33,719
Land improvements	2-20		14,149		13,361
Buildings and improvements	20		86,444		71,612
Vehicles, including transport trailers	8-20		111,283		85,893
Bulk equipment and district facilities	5-30		109,751		103,627
Tanks, cylinders and customer equipment	2-30		779,827		769,165
Computer and office equipment	2-5		111,838		109,346
Construction in progress	n/a		7,061		14,394
			1,255,518		1,201,117
Less: accumulated depreciation			658,795		643,394
Property, plant and equipment, net		$	596,723	$	557,723

Depreciation expense totaled $60.7 million, $67.1 million and $68.1 million for fiscal 2019, 2018 and 2017, respectively.

Prepaid expenses and other current assets consist of the following:


	July 31, 2019		July 31, 2018
Broker margin deposit assets	$	25,028	$	2,851
Other		17,129		31,979
Prepaid expenses and other current assets	$	42,157	$	34,830

Other assets, net consist of the following:


	July 31, 2019		July 31, 2018
Notes receivable, less current portion	$	16,216	$	27,491
Other		52,889		47,097
Other assets, net	$	69,105	$	74,588

Other current liabilities consist of the following:


	July 31, 2019		July 31, 2018
Customer deposits and advances		24,686		22,829
Accrued interest		16,550		18,288
Accrued payroll		17,356		16,060
Accrued insurance		18,524		15,100
Price risk management liabilities		14,198		1,832
Other		42,989		61,580
Other current liabilities	$	134,303	$	135,689

Shipping and handling expenses are classified in the following consolidated statements of operations line items:


	For the year ended July 31,
	2019		2018		2017
Operating expense	$	215,780	$	195,646	$	175,164
Depreciation and amortization expense		6,375		4,947		3,909
Equipment lease expense		30,759		25,765		26,299
	$	252,914	$	226,358	$	205,372

For purposes of the consolidated statements of cash flows, Ferrellgas, L.P. considers cash equivalents to include all highly liquid debt instruments purchased with an original maturity of three months or less. Certain cash flow and significant non-cash activities are presented below:


	For the year ended July 31,
	2019		2018		2017
Cash paid (refunded) for:
Interest	$	136,106	$	128,479	$	122,084
Income taxes	$	111	$	(311)	$	305
Non-cash investing and financing activities:
Liabilities incurred in connection with acquisitions	$	1,650	$	1,993	$	139
Change in accruals for property, plant and equipment additions	$	1,132	$	264	$	164

Accounts And Notes Receivable, Net And Accounts Receivable Securitization

12 Months Ended

Jul. 31, 2019

Accounts, Notes, Loans and Financing Receivable [Line Items]

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

F. Accounts and notes receivable, net and accounts receivable securitization

Accounts and notes receivable, net consist of the following:


	July 31, 2019		July 31, 2018
Accounts receivable pledged as collateral	$	106,145	$	120,079
Accounts receivable not pledged as collateral (including other reserves)		1,218		8,272
Note receivable - current portion		2,660		132
Other		36		26
Less: Allowance for doubtful accounts		(2,463)		(2,455)
Accounts and notes receivable, net	$	107,596	$	126,054

On May 14, 2018, Ferrellgas entered into a seventh amendment to its accounts receivable securitization facility with Wells Fargo Bank, N.A., Fifth Third Bank and PNC Bank, National Association. The amendment extends the maturity date to May 2021 and increases the size of the facility from a maximum borrowing capacity of $225.0 million to $250.0 million at an interest rate of LIBOR plus 200 basis points. The amended accounts receivable securitization facility also includes provisions for the issuance of letters of credit with a $50.0 million sublimit. The facility continues to contain provisions where maximum purchase levels are reduced during periods of the year when working capital requirements are lower to efficiently reduce unused capacity fees.

At July 31, 2019, $106.1 million of trade accounts receivable were pledged as collateral against $62.0 million of collateralized notes payable due to the commercial paper conduit. At July 31, 2018, $120.1 million of trade accounts receivable were pledged as collateral against $58.0 million of collateralized notes payable due to the commercial paper conduit. These accounts receivable pledged as collateral are bankruptcy remote from the operating partnership. The operating partnership does not provide any guarantee or similar support to the collectability of these accounts receivable pledged as collateral.

As of July 31, 2019, Ferrellgas had received cash proceeds of $62.0 million from trade accounts receivables securitized, with no remaining capacity to receive additional proceeds. As of July 31, 2018, Ferrellgas had received cash proceeds of $58.0 million from trade accounts receivables securitized, with no remaining capacity to receive additional proceeds. Borrowings under the accounts receivable securitization facility had a weighted average interest rate of 5.5% and 5.2% as of July 31, 2019 and 2018, respectively.

Accounts, Notes, Loans and Financing Receivable [Line Items]

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

F. Accounts and notes receivable, net and accounts receivable securitization

Accounts and notes receivable, net consist of the following:


	July 31, 2019		July 31, 2018
Accounts receivable pledged as collateral	$	106,145	$	120,079
Accounts receivable not pledged as collateral (including other reserves)		1,218		8,272
Note receivable - current portion		2,660		132
Other		36		26
Less: Allowance for doubtful accounts		(2,463)		(2,455)
Accounts and notes receivable, net	$	107,596	$	126,054

On May 14, 2018, Ferrellgas, L.P. entered into a seventh amendment to its accounts receivable securitization facility with Wells Fargo Bank, N.A., Fifth Third Bank and PNC Bank, National Association. The amendment extends the maturity date to May 2021 and increases the size of the facility from a maximum borrowing capacity of $225.0 million to $250.0 million at an interest rate of LIBOR plus 200 basis points. The amended accounts receivable securitization facility also includes provisions for the issuance of letters of credit with a $50.0 million sublimit. The facility continues to contain provisions where maximum purchase levels are reduced during periods of the year when working capital requirements are lower to efficiently reduce unused capacity fees.

At July 31, 2019, $106.1 million of trade accounts receivable were pledged as collateral against $62.0 million of collateralized notes payable due to the commercial paper conduit. At July 31, 2018, $120.1 million of trade accounts receivable were pledged as collateral against $58.0 million of collateralized notes payable due to the commercial paper conduit. These accounts receivable pledged as collateral are bankruptcy remote from Ferrellgas, L.P. Ferrellgas, L.P. does not provide any guarantee or similar support to the collectability of these accounts receivable pledged as collateral.

As of July 31, 2019, Ferrellgas, L.P. had received cash proceeds of $62.0 million from trade accounts receivables securitized, with no remaining capacity to receive additional proceeds. As of July 31, 2018, Ferrellgas, L.P. had received cash proceeds of $58.0 million from trade accounts receivables securitized, with no remaining capacity to receive additional proceeds. Borrowings under the accounts receivable securitization facility had a weighted average interest rate of 5.5% and 5.2% as of July 31, 2019 and 2018, respectively.

Goodwill And Intangible Assets, Net

12 Months Ended

Jul. 31, 2019

Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items]

G. Goodwill and intangible assets, net

Goodwill and intangible assets, net consist of the following:


	July 31, 2019						July 31, 2018
	Gross Carrying		Accumulated				Gross Carrying		Accumulated
	Amount		Amortization		Net		Amount		Amortization		Net
Goodwill, net	$	247,195	$	—	$	247,195	$	246,098	$	—	$	246,098

Intangible assets, net
Amortized intangible assets
Customer related	$	442,652	$	(390,052)	$	52,600	$	441,393	$	(376,605)	$	64,788
Non-compete agreements		25,582		(20,645)		4,937		24,653		(19,511)		5,142
Other		3,513		(3,513)		—		3,513		(3,513)		—
		471,747		(414,210)		57,537		469,559		(399,629)		69,930

Unamortized intangible assets
Trade names & trademarks		51,020		—		51,020		51,021		—		51,021
Total intangible assets, net	$	522,767	$	(414,210)	$	108,557	$	520,580	$	(399,629)	$	120,951

During fiscal 2018, Ferrellgas recorded a goodwill impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment.

Changes in the carrying amount of goodwill are as follows:


	Propane operations and
	related equipment sales
Balance July 31, 2017	$	256,103
Impairment		(10,005)
Balance July 31, 2018		246,098
Acquisitions		1,410
Other		(313)
Balance July 31, 2019	$	247,195

Customer related intangible assets have estimated lives of 15 years and non-compete agreements and other intangible assets have estimated lives ranging from five to 10 years. Ferrellgas intends to utilize all acquired trademarks and trade names and does not believe there are any legal, regulatory, contractual, competitive, economical or other factors that would limit their useful lives. Therefore, trademarks and trade names have indefinite useful lives. Customer related intangibles carry a weighted average life of 15 years, and non-compete agreements and other intangibles carry a weighted average life of nine years.

Aggregate amortization expense related to intangible assets, net:


For the year ended July 31,
2019	$	14,581
2018		31,345
2017		32,148

Estimated amortization expense:


For the year ended July 31,
2020	$	9,121
2021		8,382
2022		6,993
2023		6,666
2024		6,390

Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items]

G. Goodwill and intangible assets, net

Goodwill and intangible assets, net consist of the following:


	July 31, 2019						July 31, 2018
	Gross						Gross
	Carrying		Accumulated				Carrying		Accumulated
	Amount		Amortization		Net		Amount		Amortization		Net
Goodwill, net	$	247,195	$	—	$	247,195	$	246,098	$	—	$	246,098

Intangible assets, net
Amortized intangible assets
Customer related	$	442,652	$	(390,052)	$	52,600	$	441,393	$	(376,605)	$	64,788
Non-compete agreements		25,582		(20,645)		4,937		24,653		(19,511)		5,142
Other		3,513		(3,513)		—		3,513		(3,513)		—
		471,747		(414,210)		57,537		469,559		(399,629)		69,930

Unamortized intangible assets
Trade names & trademarks		51,020		—		51,020		51,021		—		51,021
Total intangible assets, net	$	522,767	$	(414,210)	$	108,557	$	520,580	$	(399,629)	$	120,951

Changes in the carrying amount of goodwill are as follows:


	Propane operations and
	related equipment sales
Balance July 31, 2017	$	256,103
Impairment		(10,005)
Balance July 31, 2018		246,098
Acquisitions		1,410
Other		(313)
Balance July 31, 2019	$	247,195

Customer related intangible assets have estimated lives of 15 years and non-compete agreements and other intangible assets have estimated lives ranging from five to 10 years. Ferrellgas, L.P. intends to utilize all acquired trademarks and trade names and does not believe there are any legal, regulatory, contractual, competitive, economical or other factors that would limit their useful lives. Therefore, trademarks and trade names have indefinite useful lives. Customer related intangibles carry a weighted average life of 15 years and non-compete agreements and other intangibles carry a weighted average life of nine years.

Aggregate amortization expense related to intangible assets, net:


For the year ended July 31,
2019	$	14,581
2018		31,345
2017		32,148

Estimated amortization expense:


For the year ended July 31,
2020	$	9,121
2021		8,382
2022		6,993
2023		6,666
2024		6,390

Debt

12 Months Ended

Jul. 31, 2019

Debt Disclosure [Text Block]

H. Debt

Short-term borrowings

Ferrellgas classifies borrowings on the Revolving Facility portion of its Senior Secured Credit Facility (each, as defined below) as short-term, because they are currently used to fund working capital needs that management intends to pay down within the twelve month period following the balance sheet date. As of July 31, 2019 and 2018, $43.0 million and $32.8 million, respectively, were classified as short-term borrowings. For further discussion see the “Long-term debt — Senior secured credit facilities” section below.

Long-term debt

Long-term debt consists of the following:


	2019		2018
Senior notes
Fixed rate, 6.50%, due 2021 (1)	$	500,000	$	500,000
Fixed rate, 6.75%, due 2023 (2)		500,000		500,000
Fixed rate, 6.75%, due 2022, net of unamortized premium of $1,633 and $2,375 at 2019 and 2018, respectively (3)		476,633		477,375
Fixed rate, 8.625%, due 2020, net of unamortized discount of $1,319 and $3,766 at 2019 and 2018, respectively (4)		355,681		353,234

Senior secured term loan
Variable interest rate, Term Loan, expected to mature May 2023 (5)		275,000		275,000

Notes payable
10.7% and 11.2% weighted average interest rate at July 31, 2019 and 2018, respectively, due 2020 to 2029, net of unamortized discount of $711 and $977 at July 31, 2019 and 2018, respectively		5,962		6,221
Total debt, excluding unamortized debt issuance and other costs		2,113,276		2,111,830
Unamortized debt issuance and other costs		(24,516)		(30,791)
Less: current portion of long-term debt		631,756		2,402
Long-term debt	$	1,457,004	$	2,078,637

(1)

During November 2010, the operating partnership issued $500.0 million in aggregate principal amount of 6.50% senior notes due 2021. These notes are general unsecured senior obligations of the operating partnership and are effectively junior to all existing and future senior secured indebtedness of the operating partnership, to the extent of the value of the assets securing such debt. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on May 1 and November 1 of each year. The outstanding principal amount is due on May 1, 2021.

(2)

During June 2015, the operating partnership issued $500.0 million in aggregate principal amount of 6.75% senior notes due 2023. These notes are general unsecured senior obligations of the operating partnership and are effectively junior to all existing and future senior secured indebtedness of the operating partnership, to the extent of the value of the assets securing such debt. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on June 15 and December 15 of each year. The operating partnership would incur prepayment penalties if it were to repay the notes prior to June 2021.

(3)

During fiscal 2014, the operating partnership issued $475.0 million in aggregate principal amount of 6.75% senior notes due 2022. These notes are general unsecured senior obligations of the operating partnership and are effectively junior to all existing and future senior secured indebtedness of the operating partnership, to the extent of the value of the assets securing such debt. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on January 15 and July 15 of each year. The operating partnership would incur prepayment penalties if it were to repay the notes prior to November 2019.

(4)

During January 2017, Ferrellgas Partners issued $175.0 million in aggregate principal amount of additional 8.625% unsecured senior notes due 2020, issued at 96% of par. Ferrellgas Partners contributed the net proceeds from the offering of approximately $166.1 million to the operating partnership, which used such amounts to repay borrowings under its previous senior secured credit facility. During April 2010, Ferrellgas Partners issued $280.0 million of its fixed rate senior notes. During March 2011, Ferrellgas Partners redeemed $98.0 million of these fixed rate senior notes. These notes are general unsecured senior obligations of Ferrellgas Partners and are structurally subordinated to all existing and future indebtedness and obligations of the operating partnership. The unsecured senior notes bear interest from the date of issuance, payable semi-annually in arrears on June 15 and December 15 of each year.

(5)

The Senior Secured Credit Facility, including the Term Loan, will mature on the earlier of (i) May 4, 2023 and (ii) the date that is 90 days prior to the earliest maturity date of any series of the operating partnership’s outstanding notes after giving effect to any extensions or refinancings thereof. As of this filing, the earliest maturity date of any series of the operating partnership’s outstanding notes is May 1, 2021, except for the reclassification of the Term Loan from long-term to current. See additional discussion below under “Senior secured credit facilities.”

The scheduled annual principal payments on long-term debt are as follows (this reflects the classification of the $275 million Term Loan as current. See additional discussion below under “Senior secured credit facilities”):


	Scheduled annual
For the year ending July 31,	principal payments
2020	$	634,052
2021		501,842
2022		476,187
2023		500,756
2024		292
Thereafter		544
Total	$	2,113,673

Senior secured credit facilities

On May 4, 2018, the operating partnership entered into a new $575.0 million senior secured credit facility (the “Senior Secured Credit Facility”), consisting of a $300.0 million revolving line of credit (the “Revolving Facility”) and a $275.0 million term loan (the “Term Loan”), which mature on the earlier of (i) May 4, 2023 and (ii) the date that is 90 days prior to the earliest maturity date of any series of the operating partnership’s outstanding notes after giving effect to any extensions or refinancings thereof. As of this filing, the earliest maturity date of any series of the operating partnership’s outstanding notes is May 1, 2021. Revolving Facility borrowings bear interest at the Prime Rate + 4.75% and Term Loan borrowings bear interest at LIBOR + 5.75%. The Revolving Facility includes a $125.0 million sublimit for the issuance of letters of credit. Borrowings under the Senior Secured Credit Facility are available for working capital needs, capital expenditures and other general partnership purposes, including the refinancing of existing indebtedness and acquisitions, within certain limits.

The Term Loan does not include any scheduled principal payments and the Revolving Facility does not have any scheduled commitment reductions before maturity; however, the Term Loan requires prepayments pursuant to the following: 1) certain asset sales, 2) 50% of any excess cash flow, as defined by the Term Loan, in any fiscal year beginning with fiscal year 2019, 3) certain insurance proceeds, and 4) certain tax refunds.

Disagreement with Agent under Senior Secured Credit Facility:

The financing agreement governing the operating partnership’s Senior Secured Credit Facility requires the operating partnership to deliver certain financial and other information to TPG Specialty Lending, Inc., as administrative agent and collateral agent under the financing agreement (“TPG”). Under these requirements, the operating partnership must, among other matters, deliver certain quarterly unaudited consolidated financial information of the operating partnership and its subsidiaries to TPG within 55 days after the end of each fiscal quarter, including the fourth fiscal quarter, of each fiscal year. The operating partnership failed to deliver certain quarterly financial information for the fiscal quarter ended July 31, 2019, and a related required compliance certificate, to TPG by the applicable deadline of September 24, 2019. TPG delivered a notice of default with respect to these matters on September 25, 2019, and the operating partnership delivered all required financial information and the related compliance certificate to TPG on September 25, 2019. The operating partnership believes that, under applicable law, such delivery cured the event of default under the financing agreement and therefore that no event of default presently exists. TPG, however, has advised the operating partnership of TPG’s belief that the event of default cannot be cured by delivery of the required information after the deadline and therefore that the event of default is continuing and will continue unless and until it is waived under the terms of the financing agreement. The parties have attempted to agree on a waiver of the disputed event of default. However, as of the filing of this Annual Report on Form 10-K, no such agreement has been reached, as the terms proposed by TPG were not acceptable to the operating partnership and, in the operating partnership’s opinion, were not commercially reasonable under the circumstances. As a result of the failure to reach an agreement, the operating partnership and TPG continue to dispute the existence of an event of default under the financing agreement.

Additionally, TPG has advised the operating partnership of TPG’s belief that the audited consolidated financial statements of the operating partnership and its subsidiaries for the fiscal year ended July 31, 2019, as included in this Annual Report on Form 10-K, do not satisfy the requirements set forth in the financing agreement for delivery of annual audited financial statements because the report of our independent registered public accounting firm on such financial statements includes an “explanatory paragraph” regarding substantial doubt as to the operating partnership’s ability to continue as a going concern, notwithstanding that the independent registered public accounting firm’s report expresses an unqualified opinion with respect to such financial statements. The operating partnership disagrees with the position articulated by TPG on this matter and believes that the operating partnership has fully complied with the requirements set forth in the financing agreement with respect to delivery of such financial statements. However, based on the position previously articulated by TPG on this matter, the operating partnership believes that TPG may assert that an event of default has occurred under the financing agreement with respect to the operating partnership’s compliance with the covenant requiring delivery of audited financial statements.

As a result of the notice of default delivered by TPG, the operating partnership has classified the $275 million Senior secured term loan as Current Portion of Long-Term Debt on the Consolidated Balance Sheet.The operating partnership will vigorously defend itself against any remedial action that TPG may take in respect of alleged events of default that the operating partnership does not believe are continuing or have occurred.

The Senior Secured Credit Facility is secured with substantially all of the assets of the operating partnership and its subsidiaries, and Ferrellgas Partners’ and the general partner’s partnership interests in the operating partnership, and contains various affirmative and negative covenants and default provisions, as well as requirements with respect to the maintenance of specified financial ratios and limitations on the making of loans and investments.

As of July 31, 2019, the operating partnership had borrowings of $275.0 million under the Term Loan at an interest rate of 8.16%, which was classified as current (see additional discussion above of the reclassification of the Term Loan from long-term to current), and $43.0 million under the Revolving Facility at a weighted average interest rate of 9.47%, which was classified as short-term borrowings. As of July 31, 2019, the operating partnership had available borrowing capacity under the Revolving Facility of $155.1 million. As of July 31, 2018, the operating partnership had borrowings of $275.0 million under the Term Loan at an interest rate of 7.86%, which was classified as long-term debt and $32.8 million under the Revolving Facility at an interest rate of 9.75%, which was classified as short-term borrowings. As of July 31, 2018, the operating partnership had available borrowing capacity under the Revolving Facility of $159.3 million.

Letters of credit outstanding at July 31, 2019 and 2018 totaled $101.9 million and $107.9 million, respectively, and were used to secure insurance arrangements, product purchases and commodity hedges. At July 31, 2019, Ferrellgas had remaining available letter of credit capacity of $23.1 million. At July 31, 2018, Ferrellgas had remaining available letter of credit capacity of $17.1 million. Ferrellgas incurred commitment fees of $1.0 million, $0.7 million and $1.1 million in fiscal 2019, 2018 and 2017, respectively.

On June 6, 2019, the operating partnership entered into an amendment to the agreement governing its Senior Secured Credit Facility. Among other matters, the amendment updated the calculation of the fixed charge coverage ratio for purposes of the fixed charge coverage ratio in the agreement to exclude certain maintenance capital expenditures related to the purchase of new propane delivery trucks which have historically been leased. The amendment provides that up to a specified amount of such maintenance capital expenditures will not be deducted from consolidated EBITDA for purposes of the calculation. The operating partnership was in compliance with the fixed charge coverage ratio covenant, as amended, as of July 31, 2019.

Financial covenants

The indenture governing the outstanding notes of Ferrellgas Partners and the agreements governing the operating partnership’s indebtedness contain various covenants that limit Ferrellgas Partners’ ability to, among other things, make restricted payments and incur additional indebtedness. The general partner believes that the most restrictive of these covenants are the restricted payments covenants in the indenture governing the outstanding notes of Ferrellgas Partners and the indentures governing the outstanding notes of the operating partnership, which are discussed below.

Ferrellgas Partners, L.P., the master limited partnership

The indenture governing the outstanding notes of Ferrellgas Partners due June 15, 2020 contains a covenant that restricts the ability of Ferrellgas Partners to make certain restricted payments, including distributions on its common units.

Under this covenant, subject to the limited exception described below, Ferrellgas Partners may not make a restricted payment unless its consolidated fixed charge coverage ratio (defined in the indenture generally to mean the ratio of trailing four quarters consolidated EBITDA to consolidated interest expense, both as adjusted for certain, specified items) is at least 1.75x, on a pro forma basis giving effect to the restricted payment and, if applicable, certain other specified events. As of July 31, 2019, Ferrellgas Partners’ consolidated fixed charge coverage ratio was 1.33x.

If the consolidated fixed charge coverage ratio is below 1.75x, Ferrellgas Partners may make restricted payments of up to $50.0 million in total over a sixteen quarter period. As a result of distributions paid to common unitholders in September 2017, December 2017, March 2018, June 2018 and September 2018, while this ratio was less than 1.75x, Ferrellgas Partners has used substantially all of its capacity under the limited exception and therefore is currently restricted by this covenant from making future restricted payments, including distributions to common unitholders. Accordingly, no distributions have been or will be paid to common unitholders for the three months ended July 31, 2019, and, unless this indenture is amended or replaced or Ferrellgas Partners’ consolidated fixed charge coverage ratio improves to at least 1.75x, this covenant will continue to prohibit Ferrellgas Partners from making common unit distributions.

Ferrellgas, L.P., the operating partnership

Similar to the indenture governing the outstanding notes of Ferrellgas Partners, the indentures governing the outstanding notes of the operating partnership contain covenants that restrict the ability of the operating partnership to make certain restricted payments, including distributions to Ferrellgas Partners. Under these covenants, subject to the limited exception described below, the operating partnership may not make a restricted payment unless its consolidated fixed charge coverage ratio (defined in the indentures generally to mean the ratio of trailing four quarters consolidated EBITDA to consolidated interest expense, both as adjusted for certain, specified items) is at least 1.75x on a pro forma basis giving effect to the restricted payment and, if applicable, certain other specified events. As of July 31, 2019, the operating partnership’s consolidated fixed charge coverage ratio was 1.67x.

If the consolidated fixed charge coverage ratio is below 1.75x, the operating partnership may make restricted payments in limited amounts determined under the indentures. Because the operating partnership’s consolidated fixed charge coverage ratio was below 1.75x as of April 30, 2019, the distribution made by the operating partnership on June 15, 2019 for payment of interest on Ferrellgas Partners’ unsecured senior notes due 2020 was made from capacity under the limited exception to the ratio requirement.

Although the operating partnership believes that its remaining capacity under the limited exception to the ratio requirement under the operating partnership’s indentures, and its ability to comply with the limitations on distributions under our Senior Secured Credit Facility, will allow it to make distributions to Ferrellgas Partners to cover interest payments on Ferrellgas Partners’ unsecured senior notes due 2020 through the maturity of those notes, the restrictions in these debt agreements may prevent the operating partnership from making distributions to Ferrellgas Partners to enable it to pay cash distributions to its unitholders.

Debt and interest expense reduction strategy

Ferrellgas continues to pursue a strategy to further reduce its debt and interest expense. Achievements under this strategy during fiscal 2018 included entering into the new Senior Secured Credit Facility, amending our accounts receivable securitization facility and selling certain assets. Other opportunities include the generation of additional cash flows organically or through accretive acquisitions, restructuring or refinancing existing indebtedness, selling additional assets, maintaining the suspension of Ferrellgas’common unit distributions, issuing equity or executing one or more debt exchanges. Ferrellgas expects to maintain our debt and interest expense reduction strategy until our consolidated leverage ratio reaches a level that we deem appropriate for our business. During fiscal 2019, Ferrellgas engaged Moelis & Company LLC as our financial advisor and the law firm of Squire Patton Boggs LLP to assist with our debt and interest expense reduction strategy.

Termination of interest rate swaps

In May 2012, Ferrellgas entered into a $140.0 million interest rate swap agreement to hedge against changes in fair value on a portion of its $500.0 million 6.5% fixed rate senior notes due 2021. Ferrellgas received 6.5% and paid a one-month LIBOR plus 4.715%, on the $140.0 million swapped. Ferrellgas accounted for this agreement as a fair value hedge. On May 3, 2018, Ferrellgas terminated this swap and paid the counterparty $4.2 million. Since the interest rate swap terminated involves a hedge of an interest-bearing liability, the senior notes due May 1, 2021, Ferrellgas capitalized the fair value of the hedge at termination of $4.2 million and will amortize the balance on a straight-line basis to interest expense over the remaining useful life of the hedged item. See Note L – Derivative instruments and hedging activities for more information.

In May 2012, Ferrellgas entered into a forward interest rate swap agreement to hedge against variability in forecasted interest payments on Ferrellgas’ previous senior secured credit facility and collateralized note payable borrowings under the accounts receivable securitization facility. From August 2015 through July 2017, Ferrellgas paid 1.95% and received variable payments based on one-month LIBOR for the notional amount of $175.0 million. From August 2017 through May 2018, Ferrellgas paid 1.95% and received variable payments based on one-month LIBOR for the notional amount of $100.0 million. Ferrellgas accounted for this agreement as a cash flow hedge. On May 3, 2018, Ferrellgas terminated this interest rate swap. Ferrellgas recorded the immaterial gain immediately to earnings. The cash flows from these contracts are reported as operating activities in the Consolidated Statement of Cash Flows. See Note L – Derivative instruments and hedging activities for more information.

Debt Disclosure [Text Block]

H. Debt

Short-term borrowings

Ferrellgas, L.P classifies borrowings on the Revolving Facility portion of its Senior Secured Credit Facility (each, as defined below) as short-term, because they are currently used to fund working capital needs that management intends to pay down within the twelve month period following the balance sheet date. As of July 31, 2019 and 2018, $43.0 million and $32.8 million, respectively, were classified as short-term borrowings. For further discussion see the “Long-term debt – Senior secured credit facilities” section below.

Long-term debt

Long-term debt consists of the following:


	2019		2018
Senior notes
Fixed rate, 6.50%, due 2021 (1)	$	500,000	$	500,000
Fixed rate, 6.75%, due 2023 (2)		500,000		500,000
Fixed rate, 6.75%, due 2022, net of unamortized premium of $1,633 and $2,375 at 2019 and 2018, respectively (3)		476,633		477,375

Senior secured term loan
Variable interest rate, Term Loan, expected to mature May 2023 (4)		275,000		275,000

Notes payable
10.7% and 11.2% weighted average interest rate at July 31, 2019 and 2018, respectively, due 2020 to 2029, net of unamortized discount of $711 and $977 at July 31, 2019 and 2018, respectively		5,962		6,221
Total debt, excluding unamortized debt issuance and other costs		1,757,595		1,758,596
Unamortized debt issuance and other costs		(23,562)		(28,057)
Less: current portion of long-term debt		277,029		2,402
Long-term debt	$	1,457,004	$	1,728,137

(1)

During November 2010, Ferrellgas, L.P. issued $500.0 million in aggregate principal amount of new 6.50% senior notes due 2021.These notes are general unsecured senior obligations of Ferrellgas, L.P. and are effectively junior to all existing and future senior secured indebtedness of Ferrellgas, L.P., to the extent of the value of the assets securing such debt. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on May 1 and November 1 of each year. The outstanding principal amount is due on May 1, 2021.

(2)

During June 2015, Ferrellgas, L.P. issued $500.0 million in aggregate principal amount of 6.75% senior notes due 2023. These notes are general unsecured senior obligations of Ferrellgas, L.P. and are effectively junior to all existing and future senior secured indebtedness of Ferrellgas, L.P., to the extent of the value of the assets securing such debt. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on June 15 and December 15 of each year. Ferrellgas, L.P. would incur prepayment penalties if it were to repay the notes prior to June 2021.

(3)

During fiscal 2014, Ferrellgas, L.P. issued $475.0 million in aggregate principal amount of 6.75% senior notes due 2022. These notes are general unsecured senior obligations of Ferrellgas, L.P. and are effectively junior to all existing and future senior secured indebtedness of Ferrellgas, L.P., to the extent of the value of the assets securing such debt. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on January 15 and July 15 of each year. Ferrellgas, L.P. would incur prepayment penalties if it were to repay the notes prior to November 2019.

(4)


For the year ending July 31,	Scheduled annual principal payments
2020	$	277,052
2021		501,842
2022		476,187
2023		500,756
2024		292
Thereafter		544
Total	$	1,756,673

Senior secured credit facilities

On May 4, 2018, Ferrellgas, L.P. entered into a new $575.0 million senior secured credit facility (the “Senior Secured Credit Facility”) consisting of a $300.0 million revolving line of credit (the “Revolving Facility”) and a $275.0 million term loan (the “Term Loan”), which mature on the earlier of (i) May 4, 2023 and (ii) the date that is 90 days prior to the earliest maturity date of any series of the operating partnership’s outstanding notes after giving effect to any extensions or refinancings thereof. As of this filing, the earliest maturity date of any series of the operating partnership’s outstanding notes is May 1, 2021. Revolving Facility borrowings bear interest at the Prime Rate + 4.75% and Term Loan borrowings bear interest at LIBOR + 5.75%. The Revolving Facility includes a $125.0 million sublimit for the issuance of letters of credit. Borrowings under the Senior Secured Credit Facility are available for working capital needs, capital expenditures and other general partnership purposes, including the refinancing of existing indebtedness and acquisitions, within certain limits.

Disagreement with Agent under Senior Secured Credit Facility:

The financing agreement governing the operating partnership’s Senior Secured Credit Facility requires the operating partnership to deliver certain financial and other information to TPG Specialty Lending, Inc., as administrative agent and collateral agent under the financing agreement (“TPG”). Under these requirements, the operating partnership must, among other matters, deliver certain quarterly unaudited consolidated financial information of the operating partnership and its subsidiaries to TPG within 55 days after the end of each fiscal quarter, including the fourth fiscal quarter, of each fiscal year. The operating partnership failed to deliver certain quarterly financial information for the fiscal quarter ended July 31, 2019, and a related required compliance certificate, to TPG by the applicable deadline of September 24, 2019. TPG delivered a notice of default with respect to these matters on September 25, 2019, and the operating partnership delivered all required financial information and the related compliance certificate to TPG on September 25, 2019. The operating partnership believes that, under applicable law, such delivery cured the event of default under the financing agreement and therefore that no event of default presently exists.TPG, however, has advised the operating partnership of TPG’s belief that the event of default cannot be cured by delivery of the required information after the deadline and therefore that the event of default is continuing and will continue unless and until it is waived under the terms of the financing agreement.The parties have attempted to agree on a waiver of the disputed event of default. However, as of the filing of this Annual Report on Form 10-K, no such agreement has been reached, as the terms proposed by TPG were not acceptable to the operating partnership and, in the operating partnership’s opinion, were not commercially reasonable under the circumstances. As a result of the failure to reach an agreement, the operating partnership and TPG continue to dispute the existence of an event of default under the financing agreement.

The Senior Secured Credit Facility is secured with substantially all of the assets of Ferrellgas, L.P. and its subsidiaries, and Ferrellgas Partners’ and the general partner’s partnership interests in Ferrellgas, L.P., and contains various affirmative and negative covenants and default provisions, as well as requirements with respect to the maintenance of specified financial ratios and limitations on the making of loans and investments.

As of July 31, 2019, Ferrellgas, L.P. had borrowings of $275.0 million under the Term Loan at an interest rate of 8.16%, which was classified as current, (see additional discussion above of the reclassification of the Term Loan from long-term to current) and $43.0 million under the Revolving Facility at a weighted average interest rate of 9.47%, which was classified as short-term borrowings. As of July 31, 2019, Ferrellgas, L.P. had available borrowing capacity under the Revolving Facility of $155.1 million. As of July 31, 2018, Ferrellgas, L.P. had borrowings of $275.0 million under the Term Loan at an interest rate of 7.86%, which was classified as long-term debt and $32.8 million under the Revolving Facility at an interest rate of 9.75%, which was classified as short-term borrowings. As of July 31, 2018, Ferrellgas, L.P. had available borrowing capacity under the Revolving Facility of $159.3 million.

Letters of credit outstanding at July 31, 2019 and 2018 totaled $101.9 million and $107.9 million, respectively, and were used to secure insurance arrangements, product purchases and commodity hedges. At July 31, 2019, Ferrellgas, L.P. had remaining available letter of credit capacity of $23.1 million. At July 31, 2018 Ferrellgas, L.P. had remaining available letter of credit capacity of $17.1 million. Ferrellgas, L.P. incurred commitment fees of $1.0 million, $0.7 million and $1.1 million in fiscal 2019, 2018 and 2017, respectively.

On June 6, 2019, Ferrellgas, L.P. entered into an amendment to the agreement governing its Senior Secured Credit Facility. Among other matters, the amendment updated the calculation of the fixed charge coverage ratio for purposes of the fixed charge coverage ratio in the agreement to exclude certain maintenance capital expenditures related to the purchase of new propane delivery trucks which have historically been leased. The amendment provides that up to a specified amount of such maintenance capital expenditures will not be deducted from consolidated EBITDA for purposes of the calculation. The operating partnership was in compliance with the fixed charge coverage ratio covenant, as amended, as of July 31, 2019.

Financial covenants

The agreements governing the operating partnership’s indebtedness contain various covenants that limit the operating partnership’s ability to, among other things, make restricted payments and incur additional indebtedness. The general partner believes that the most restrictive of these covenants are the restricted payments covenants in the indentures governing the outstanding notes of the operating partnership, which are discussed below.

Similar to the indenture governing the outstanding notes of Ferrellgas Partners, the indentures governing the outstanding notes of the operating partnership contain covenants that restrict the ability of the operating partnership to make certain restricted payments, including distributions to Ferrellgas Partners. Under these covenants, subject to the limited exception described below, the operating partnership may not make a restricted payment unless its consolidated fixed charge coverage ratio (defined in the indentures generally to mean the ratio of trailing four quarters consolidated EBITDA to consolidated interest expense, both as adjusted for certain, specified items) is at least 1.75x , on a pro forma basis giving effect to the restricted payment and, if applicable, certain other specified events. As of July 31, 2019, the operating partnership’s consolidated fixed charge coverage ratio was 1.67x.

Debt and interest expense reduction strategy

Ferrellgas, L.P. continues to pursue a strategy to further reduce its debt and interest expense. Achievements under this strategy during fiscal 2018 included entering into the new Senior Secured Credit Facility, amending our accounts receivable securitization facility and selling certain assets. Other opportunities include the generation of additional cash flows organically or through accretive acquisitions, restructuring or refinancing existing indebtedness, selling additional assets, maintaining the suspension of Ferrellgas Partners’ common unit distributions, issuing equity or executing one or more debt exchanges. Ferrellgas, L.P. expects to maintain our debt and interest expense reduction strategy until the consolidated leverage ratio reaches a level that we deem appropriate for our business. During fiscal 2019, Ferrellgas, L.P. engaged Moelis & Company LLC as our financial advisor and the law firm of Squire Patton Boggs LLP to assist with our debt and interest expense reduction strategy.

Termination of interest rate swaps

In May 2012, Ferrellgas, L.P. entered into a $140.0 million interest rate swap agreement to hedge against changes in fair value on a portion of its $500.0 million 6.5% fixed rate senior notes due 2021. Ferrellgas, L.P. received 6.5% and paid a one-month LIBOR plus 4.715%, on the $140.0 million swapped. The operating partnership accounted for this agreement as a fair value hedge. On May 3, 2018, Ferrellgas, L.P. terminated this swap and paid the counterparty $4.2 million. Since the interest rate swap terminated involves a hedge of an interest-bearing liability, the senior notes due May 2021, Ferrellgas, L.P. capitalized the fair value of the hedge at termination of $4.2 million and will amortize the balance on a straight-line basis to interest expense over the remaining useful life of the hedged item. See Note L – Derivative instruments and hedging activities for more information.

In May 2012, Ferrellgas, L.P. entered into a forward interest rate swap agreement to hedge against variability in forecasted interest payments on Ferrellgas, L.P.’s previous senior secured credit facility and collateralized note payable borrowings under the accounts receivable securitization facility. From August 2015 through July 2017, Ferrellgas, L.P. paid 1.95% and received variable payments based on one-month LIBOR for the notional amount of $175.0 million. From August 2017 through May 2018, Ferrellgas, L.P. paid 1.95% and received variable payments based on one-month LIBOR for the notional amount of $100.0 million. Ferrellgas, L.P. accounted for this agreement as a cash flow hedge. On May 3, 2018, Ferrellgas, L.P. terminated this interest rate swap. Ferrellgas, L.P. recorded the immaterial gain immediately to earnings. The cash flows from these contracts are reported as operating activities in the Consolidated Statement of Cash Flows. See Note L – Derivative instruments and hedging activities for more information.

Partners' deficit

12 Months Ended

Jul. 31, 2019

Partners' deficit

I. Partners’ deficit

As of July 31, 2019 and 2018, limited partner units were beneficially owned by the following:


	July 31, 2019	July 31, 2018
Public common unitholders (1)	69,612,939	69,612,939
Ferrell Companies (2)	22,529,361	22,529,361
FCI Trading Corp. (3)	195,686	195,686
Ferrell Propane, Inc. (4)	51,204	51,204
James E. Ferrell (5)	4,763,475	4,763,475

(1)

These common units are listed on the New York Stock Exchange under the symbol “FGP.”

(2)

Ferrell Companies is the owner of the general partner and an approximate 23.2% direct owner of Ferrellgas Partners’ common units and thus a related party. Ferrell Companies also beneficially owns 195,686 and 51,204 common units of Ferrellgas Partners held by FCI Trading Corp. (“FCI Trading”) and Ferrell Propane, Inc. (“Ferrell Propane”), respectively, bringing Ferrell Companies’ total beneficial ownership to 23.4%.

(3)

FCI Trading is an affiliate of the general partner and thus a related party.

(4)

Ferrell Propane is controlled by the general partner and thus a related party.

(5)

James E. Ferrell is the Interim Chief Executive Officer and President of our general partner; and is the Chairman of the Board of Directors of our general partner and a related party. JEF Capital Management owns 4,758,859 of these common units and is owned by the James E. Ferrell Revocable Trust Two and other family trusts, all of which James E. Ferrell and/or his family members are the trustees and beneficiaries. James E. Ferrell holds all voting common stock of JEF Capital Management. The remaining 4,616 common units are held by Ferrell Resources Holdings, Inc., which is wholly-owned by the James E. Ferrell Revocable Trust One, for which James E. Ferrell is the trustee and sole beneficiary.

Together these limited partner units represent Ferrellgas Partners’ limited partners’ interest and an effective 98% economic interest in Ferrellgas Partners, exclusive of the general partner’s incentive distribution rights. The general partner has an effective 2% interest in Ferrellgas Partners, excluding incentive distribution rights. Since ongoing distributions have not yet reached the levels required to commence payment of incentive distribution rights to the general partner, distributions to the partners from operations or interim capital transactions will generally be made in accordance with the above percentages. In liquidation, allocations and distributions will be made in accordance with each common unitholder’s positive capital account.

The common units of Ferrellgas Partners represent limited partner interests in Ferrellgas Partners, which give the holders thereof the right to participate in distributions made by Ferrellgas Partners and to exercise the other rights or privileges available to such holders under the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P. dated February 18, 2003, as amended (the “Partnership Agreement”). Under the terms of the Partnership Agreement, holders of common units have limited voting rights on matters affecting the business of Ferrellgas Partners. Generally, persons owning 20% or more of Ferrellgas Partners’ outstanding common units cannot vote; however, this limitation does not apply to those common units owned by the general partner or its “affiliates,” as such term is defined in the Partnership Agreement.

The Partnership Agreement allows the general partner to issue an unlimited number of additional Ferrellgas general and limited partner interests of Ferrellgas Partners for such consideration and on such terms and conditions as shall be established by the general partner without the approval of any unitholders.

Partnership distributions

Ferrellgas Partners has recognized the following distributions:


	For the year ended July 31,
	2019		2018		2017
Public common unitholders	$	6,962	$	27,846	$	56,561
Ferrell Companies		2,253		9,012		18,305
FCI Trading Corp.		20		80		160
Ferrell Propane, Inc.		5		20		41
James E. Ferrell		476		1,904		3,869
General partner		98		392		797
	$	9,814	$	39,254	$	79,733

Ferrellgas Partners paid cash distributions as detailed in the table above. Ferrellgas Partners did not declare a cash distribution related to the three months ended October 31, 2018, the three months ended January 31, 2019, the three months ended April 30, 2019, or the three months ended July 31, 2019. As discussed in Note H – Debt, Ferrellgas Partners was not permitted, pursuant to the consolidated fixed charge coverage ratio under its indenture, to make restricted payments, including distributions to unitholders.

Common unit repurchases

During September 2016, Ferrellgas paid approximately $16.9 million to Jamex Marketing, LLC, and in return received approximately 0.9 million Ferrellgas Partners’ common units, which were cancelled upon receipt, and approximately 23 thousand barrels of crude oil.

Accumulated Other Comprehensive Income (Loss)(“AOCI”)

See Note L – Derivative instruments and hedging activities – for details regarding changes in fair value on risk management financial derivatives recorded within AOCI for the years ended July 31, 2019 and 2018.

General partner’s commitment to maintain its capital account

Ferrellgas’ partnership agreements allows the general partner to have an option to maintain its effective 2% general partner interest concurrent with the issuance of other additional equity.

During fiscal 2019, the general partner made non-cash contributions of $0.1 million to Ferrellgas to maintain its effective 2% general partner interest.

During fiscal 2018, the general partner made non-cash contributions of $0.3 million to Ferrellgas to maintain its effective 2% general partner interest.

Partners' deficit

I. Partners’ deficit

Partnership distributions:

Ferrellgas, L.P. has recognized the following distributions:


	For the year ended July 31,
	2019		2018		2017
Ferrellgas Partners	$	40,706	$	70,246	$	102,978
General partner		415		716		1,050

See additional discussions about transactions with related parties in Note M – Transactions with related parties.

Other Partnership distributions

During September 2016, in connection with Ferrellgas Partners’ repurchase of common units, Ferrellgas, L.P distributed $15.9 million to Ferrellgas Partners.

Other partnership contributions

During fiscal 2017, Ferrellgas, L.P. received cash contributions of $166.1 million and $1.7 million from Ferrellgas Partners and the general partner, respectively, which were used to reduce borrowings under the previous senior secured credit facility.

See additional discussions about transactions with related parties in Note M – Transactions with related parties.

Accumulated other comprehensive income (loss)(“AOCI”)

See Note K – Derivative instruments and hedging activities – for details regarding changes in fair value on risk management financial derivatives recorded within AOCI for the years ended July 31, 2019 and 2018.

General partner’s commitment to maintain its capital account

Ferrellgas, L.P.’s partnership agreement allows the general partner to have an option to maintain its 1.0101% general partner interest concurrent with the issuance of other additional equity.

During fiscal 2019, the general partner made non-cash contributions of $0.1 million to Ferrellgas, L.P. to maintain its 1.0101% general partner interest.

During fiscal 2018, the general partner made cash contributions of $0.1 million and non-cash contributions of $0.1 million to Ferrellgas, L.P. to maintain its 1.0101% general partner interest.

Revenue from contracts with customers

12 Months Ended

Jul. 31, 2019

Revenue from Contract with Customer [Text Block]

J.Revenue from contracts with customers

Ferrellgas adopted ASU 2014‑09 beginning on August 1, 2018 using the modified retrospective method. Ferrellgas earns revenue from contracts with customers primarily through the distribution of propane, as well as through the sale of propane related equipment and supplies. Revenues from propane and other gas liquids sales are comprised of revenue earned from the delivery of propane to tanks on customers’ premises, from the delivery of propane filled cylinders to customers, or from the sale of portable propane tanks to nationwide and local retailers and end use customers. Other revenues primarily include sales of appliances and other materials as well as other fees charged to customers. Upon adoption, Ferrellgas applied ASU 2014‑09 only to contracts that were not completed.

Contracts with customers

Ferrellgas’ contracts with customers are principally for the bulk delivery of propane to tanks, delivery of propane filled cylinders or the delivery of portable propane tanks to retailers. Ferrellgas sells propane to a wide variety of customers, including residential, industrial/commercial, portable tank exchange, agricultural, wholesale and others. Ferrellgas’ performance obligations in these contracts are generally limited to the delivery of propane, and therefore revenues from these contracts are earned at the time product is delivered or, in the case of some of Ferrellgas’ portable tank exchange retailers who have consignment agreements, at the time the tanks are sold to the end use customer. Payment is generally due within 30 days. Revenues from sales of propane are included in Propane and other gas liquids sales on the consolidated statements of operations.

Typically, Ferrellgas bills customers upon delivery and payment is generally due within 30 days. With its residential customers, Ferrellgas offers customers the ability to spread their annual heating costs over a longer period, typically twelve months. Customers who opt to spread their heating costs over a longer period are referred to as “even pay” customers.

Ferrellgas charges other amounts to customers associated with the delivery of propane including hazardous materials fees and fuel surcharge fees. In some regions, Ferrellgas also sells appliances and related parts and fittings as well as other retail propane related services. Ferrellgas charges on an annual basis tank and equipment rental charges for customers that are using our equipment to store propane. Other revenues associated with deliveries of propane are earned at the time product is delivered. Revenues associated with sales of appliances and other materials or services are earned at the time of delivery or installation. Revenues associated with tank and equipment rentals are generally recognized on a straight-line basis over one year.

Accounting estimates related to recognition of revenue require that Ferrellgas make estimates and assumptions about various factors including credits issued for completed sales, future returns and total consideration payable in instances where we have customer incentives payable to the customer.

Disaggregation of revenue

Ferrellgas disaggregates revenues based upon the type of customer and on the type of revenue. The following table presents retail propane revenues, wholesale propane revenues and other revenues. Retail revenues result from sales to end use customers, wholesale revenues result from sales to or through resellers and all other revenues include sales of appliances and other materials, other fees charged to customers and equipment rental charges.


	For the year ended July 31,
	2019		2018		2017
Retail - Sales to End Users	$	1,128,991	$	1,082,046	$	852,130
Wholesale - Sales to Resellers		419,349		448,943		396,100
Other Gas Sales		60,518		111,987		70,182
Other		75,534		147,847		145,162
Propane and related equipment revenues	$	1,684,392	$	1,790,823	$	1,463,574

Contract assets and liabilities

Ferrellgas’ performance obligations are generally limited to the delivery of propane for our retail and wholesale contracts. Ferrellgas’ performance obligations with respect to sales of appliances and other materials and other revenues are limited to the delivery of the agreed upon good or service. Ferrellgas does not have material performance obligations that are delivered over time, thus all of our revenue is recognized at the time the goods, including propane, are delivered or installed. Ferrellgas offers “even pay” billing programs that can create customer deposits or advances, depending on whether Ferrellgas has delivered more propane than the customer has paid for or whether the customer has paid for more propane than what has been delivered. Revenue is recognized from these customer deposits or advances to customers at the time product is delivered. The advance or deposit is considered to be a contract asset or liability. Additionally, from time to time, we have customers that pay in advance for goods or services, and such amounts result in contract liabilities.

Ferrellgas incurs incremental commissions directly related to the acquisition or renewal of customer contracts. The commissions are calculated and paid based upon the number of gallons sold to the acquired or renewed customer. The total amount of commissions that we incur is not material, and the commissions are expensed commensurate with the deliveries to which they relate; therefore, Ferrellgas does not capitalize these costs.

The following table presents the opening and closing balances of our receivables, contract assets, and contract liabilities:


	July 31, 2019		July 31, 2018
Accounts receivable	$	96,450	$	119,818
Contract assets	$	13,609	$	8,691
Contract liabilities
Deferred revenue (1)	$	31,974	$	29,933

(1)

Of the beginning balance of deferred revenue, $27.0 million was recognized as revenue during the year ended July 31, 2019.

Remaining performance obligations

Ferrellgas’ remaining performance obligations are generally limited to situations where its customers have remitted payment but have not yet received deliveries of propane. This most commonly occurs in Ferrellgas’ even pay billing programs and Ferrellgas expects that these balances will be recognized within a year or less as the customer takes delivery of propane.

Revenue from Contract with Customer [Text Block]

J. Revenue from contracts with customers

Ferrellgas, L.P. adopted ASU 2014‑09 beginning on August 1, 2018 using the modified retrospective method. Ferrellgas, L.P. earns revenue from contracts with customers primarily through the distribution of propane, as well as through the sale of propane related equipment and supplies. Revenues from propane and other gas liquids sales are comprised of revenue earned from the delivery of propane to tanks on customers’ premises, from the delivery of propane filled cylinders to customers, or from the sale of portable propane tanks to nationwide and local retailers and end use customers. Other revenues primarily include sales of appliances and other materials as well as other fees charged to customers. Upon adoption, Ferrellgas, L.P. applied ASU 2014‑09 only to contracts that were not completed.

Contracts with customers

Ferrellgas, L.P.’s contracts with customers are principally for the bulk delivery of propane to tanks, delivery of propane filled cylinders or the delivery of portable propane tanks to retailers. Ferrellgas, L.P. sells propane to a wide variety of customers, including residential, industrial/commercial, portable tank exchange, agricultural, wholesale and others. Ferrellgas, L.P.’s performance obligations in these contracts are generally limited to the delivery of propane, and therefore revenues from these contracts are earned at the time product is delivered or, in the case of some of Ferrellgas, L.P.’s portable tank exchange retailers who have consignment agreements, at the time the tanks are sold to the end use customer. Payment is generally due within 30 days. Revenues from sales of propane are included in Propane and other gas liquids sales on the consolidated statements of operations.

Typically, Ferrellgas, L.P. bills customers upon delivery and payment is generally due within 30 days. With its residential customers, Ferrellgas, L.P offers customers the ability to spread their annual heating costs over a longer period, typically twelve months. Customers who opt to spread their heating costs over a longer period are referred to as “even pay” customers.

Ferrellgas, L.P. charges other amounts to customers associated with the delivery of propane including hazardous materials fees and fuel surcharge fees. In some regions, Ferrellgas, L.P. also sells appliances and related parts and fittings as well as other retail propane related services. Ferrellgas, L.P. charges on an annual basis tank and equipment rental charges for customers that are using our equipment to store propane. Other revenues associated with deliveries of propane are earned at the time product is delivered. Revenues associated with sales of appliances and other materials or services are earned at the time of delivery or installation. Revenues associated with tank and equipment rentals are generally recognized on a straight-line basis over one year.

Accounting estimates related to recognition of revenue require that Ferrellgas, L.P. make estimates and assumptions about various factors including credits issued for completed sales, future returns and total consideration payable in instances where we have customer incentives payable to the customer.

Disaggregation of revenue

Ferrellgas, L.P. disaggregates revenues based upon the type of customer and on the type of revenue. The following table presents retail propane revenues, wholesale propane revenues and other revenues. Retail revenues result from sales to end use customers, wholesale revenues result from sales to or through resellers and all other revenues include sales of appliances and other materials, other fees charged to customers and equipment rental charges.


	For the year ended July 31,
	2019		2018		2017
Retail - Sales to End Users	$	1,128,991	$	1,082,046	$	852,130
Wholesale - Sales to Resellers		419,349		448,943		396,100
Other Gas Sales		60,518		111,987		70,182
Other		75,534		147,847		145,162
Propane and related equipment revenues	$	1,684,392	$	1,790,823	$	1,463,574

Contract assets and liabilities

The following table presents the opening and closing balances of our receivables, contract assets, and contract liabilities:


	July 31, 2019		July 31, 2018
Accounts receivable	$	96,450	$	119,818
Contract assets	$	13,609	$	8,691
Contract liabilities
Deferred revenue (1)	$	31,974	$	29,933

(1)

Of the beginning balance of deferred revenue, $27.0 million was recognized as revenue during the year ended July 31, 2019.

Remaining performance obligations

Fair Value Measurements

12 Months Ended

Jul. 31, 2019

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fair Value Measurements

K. Fair value measurements

Derivative Financial Instruments

The following table presents Ferrellgas’ financial assets and financial liabilities that are measured at fair value on a recurring basis for each of the fair value hierarchy levels, including both current and noncurrent portions, as of July 31, 2019 and 2018


	Asset (Liability)
	Quoted Prices in Active
	Markets for Identical		Significant Other
	Assets and Liabilities		Observable Inputs		Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
July 31, 2019:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	1,259	$	—	$	1,259
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(16,015)	$	—	$	(16,015)

July 31, 2018:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	22,470	$	—	$	22,470
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(1,910)	$	—	$	(1,910)

Methodology

The fair values of Ferrellgas’ non-exchange traded commodity derivative contracts are based upon indicative price quotations available through brokers, industry price publications or recent market transactions and related market indicators. The fair values of interest rate swap contracts are based upon third-party quotes or indicative values based on recent market transactions.

Other Financial Instruments

The carrying amounts of other financial instruments included in current assets and current liabilities (except for current maturities of long-term debt) approximate their fair values because of their short-term nature. The estimated fair value of various note receivable financial instruments classified in “Other assets, net” on the consolidated balance sheet, are approximately $15.5 million, or $0.7 million less than its carrying amount as of July 31, 2019. The estimated fair value of these notes receivable was calculated using a discounted cash flow method which relied on significant unobservable inputs. At July 31, 2019 and July 31, 2018, the estimated fair value of Ferrellgas’ long-term debt instruments was $1,824.6 million and $1,935.1 million, respectively. Ferrellgas estimates the fair value of long-term debt based on quoted market prices. The fair value of Ferrellgas’ consolidated debt obligations is a Level 2 valuation based on the observable inputs used for similar liabilities.

Ferrellgas has other financial instruments such as trade accounts receivable which could expose it to concentrations of credit risk. The credit risk from trade accounts receivable is limited because of a large customer base which extends across many different U.S. markets.

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fair Value Measurements

K. Fair value measurements

Derivative Financial Instruments

The following table presents Ferrellgas, L.P.’s financial assets and financial liabilities that are measured at fair value on a recurring basis for each of the fair value hierarchy levels, including both current and noncurrent portions, as of July 31, 2019 and 2018:


	Asset (Liability)
	Quoted Prices in Active
	Markets for Identical		Significant Other
	Assets and Liabilities		Observable Inputs		Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
July 31, 2019:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	1,259	$	—	$	1,259
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(16,015)	$	—	$	(16,015)

July 31, 2018:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	22,470	$	—	$	22,470
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(1,910)	$	—	$	(1,910)

Methodology

The fair values of Ferrellgas, L.P.’s non-exchange traded commodity derivative contracts are based upon indicative price quotations available through brokers, industry price publications or recent market transactions and related market indicators. The fair values of interest rate swap contracts are based upon third-party quotes or indicative values based on recent market transactions.

Other Financial Instruments

The carrying amounts of other financial instruments included in current assets and current liabilities (except for current maturities of long-term debt) approximate their fair values because of their short-term nature. The estimated fair value of various note receivable financial instruments classified in “Other assets, net” on the consolidated balance sheets, are approximately $15.5 million, or $0.7 million less than its carrying amount, as of July 31, 2019. The estimated fair value of these notes receivable was calculated using a discounted cash flow method which relied on significant unobservable inputs. At July 31, 2019 and July 31, 2018, the estimated fair value of Ferrellgas, L.P.’s long-term debt instruments was $1,562.2 million and $1,591.5 million, respectively. Ferrellgas, L.P. estimates the fair value of long-term debt based on quoted market prices. The fair value of our consolidated debt obligations is a Level 2 valuation based on the observable inputs used for similar liabilities.

Ferrellgas, L.P. has other financial instruments such as trade accounts receivable which could expose it to concentrations of credit risk. The credit risk from trade accounts receivable is limited because of a large customer base which extends across many different U.S. markets.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Derivative Instruments and Hedging Activities

12 Months Ended

Jul. 31, 2019

Derivative [Line Items]

Derivative Instruments and Hedging Activities

L. Derivative instruments and hedging activities

Ferrellgas is exposed to certain market risks related to its ongoing business operations. These risks include exposure to changing commodity prices as well as fluctuations in interest rates. Ferrellgas utilizes derivative instruments to manage its exposure to fluctuations in commodity prices. Of these, the propane commodity derivative instruments are designated as cash flow hedges. Prior to the sale of Bridger Energy, LLC in January 2018, all other commodity derivative instruments neither qualified nor were designated as cash flow hedges, therefore, the change in their fair value is recorded currently in earnings. Ferrellgas may periodically utilize derivative instruments to manage its exposure to fluctuations in interest rates.

Derivative instruments and hedging activity

During the year ended July 31, 2019 and 2018, Ferrellgas did not recognize any gain or loss in earnings related to hedge ineffectiveness and did not exclude any component of financial derivative contract gains or losses from the assessment of hedge effectiveness related to commodity cash flow hedges.

The following tables provide a summary of the fair value of derivatives within Ferrellgas’ consolidated balance sheets as of July 31, 2019 and 2018:


	July 31, 2019
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	910	Other current liabilities	$	14,198
Commodity derivatives-propane	Other assets, net		349	Other liabilities		1,817
	Total	$	1,259	Total	$	16,015


	July 31, 2018
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	17,123	Other current liabilities	$	1,832
Commodity derivatives-propane	Other assets, net		5,347	Other liabilities		78
	Total	$	22,470	Total	$	1,910

Ferrellgas’ exchange traded commodity derivative contracts require cash margin deposit as collateral for contracts that are in a negative mark-to-market position. These cash margin deposits will be returned if mark-to-market conditions improve or will be applied against cash settlement when the contracts are settled. Liabilities represent cash margin deposits received by Ferrellgas for contracts that are in a positive mark-to-market position. The following tables provide a summary of cash margin balances as of July 31, 2019 and July 31, 2018, respectively:


	July 31, 2019
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	25,028	Other current liabilities	$	1,217
	Other assets, net		2,969	Other liabilities		—
		$	27,997		$	1,217


	July 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	2,851	Other current liabilities	$	12,308
	Other assets, net		927	Other liabilities		4,235
		$	3,778		$	16,543

During fiscal 2018, Ferrellgas terminated the interest rate swaps that were designated as a fair value hedging instrument and cash flow hedging instrument. Upon termination, Ferrellgas paid the counterparty $4.2 million. Since the interest rate swap designated as a fair value hedging instrument that was terminated involves a hedge of an interest-bearing liability, the senior notes due May 1, 2021, Ferrellgas capitalized the fair value of the hedge at termination of $4.2 million and will amortize the balance on a straight-line basis to interest expense over the remaining useful life of the hedged item, the 2021 Notes. For information on the interest rate swap terminations, see Note H – Debt.The following table provides a summary of the effect on Ferrellgas’ consolidated statements of comprehensive income for the years ended July 31, 2019, 2018 and 2017 due to derivatives designated as fair value hedging instruments:


								Amount of Interest Expense
		Amount of Gain Recognized on						Recognized on Fixed-Rated Debt
	Location of Gain	Derivative						(Related Hedged Item)
	Recognized on	For the year ended July 31,						For the year ended July 31,
Derivative Instrument	Derivative	2019		2018		2017		2019		2018		2017
Interest rate swap agreements	Interest expense	$	—	$	266	$	1,319	$	—	$	(6,825)	$	(9,100)

The following tables provide a summary of the effect on Ferrellgas’ consolidated statements of comprehensive income for the years ended July 31, 2019, 2018 and 2017 due to derivatives designated as cash flow hedging instruments:


	For the year ended July 31, 2019
				Amount of Gain (Loss)
	Amount of Gain		Location of Gain (Loss)	Reclassified from
	(Loss) Recognized in		Reclassified from	AOCI into Income
Derivative Instrument	AOCI		AOCI into Income	Effective portion		Ineffective portion
Commodity derivatives	$	(48,184)	Cost of product sold- propane and other gas liquids sales	$	(12,868)	$	—
	$	(48,184)		$	(12,868)	$	—


	For the year ended July 31, 2018
				Amount of Gain (Loss)
	Amount of Gain (Loss)		Location of Gain (Loss)	Reclassified from
	Recognized in		Reclassified from	AOCI into Income
Derivative Instrument	AOCI		AOCI into Income	Effective portion		Ineffective portion
Commodity derivatives	$	30,231	Cost of product sold- propane and other gas liquids sales	$	24,714	$	—
Interest rate swap agreements		—	Interest expense		(395)		—
	$	30,231		$	24,319	$	—


	For the year ended July 31, 2017
				Amount of Gain (Loss)
	Amount of Gain (Loss)		Location of Gain (Loss)	Reclassified from
	Recognized in		Reclassified from	AOCI into Income
Derivative Instrument	AOCI		AOCI into Income	Effective portion		Ineffective portion
Commodity derivatives	$	21,659	Cost of sales-propane and other gas liquids sales	$	154	$	—
Interest rate swap agreements		866	Interest expense		(2,092)		—
	$	22,525		$	(1,938)	$	—

The following table provides a summary of the effect on Ferrellgas’ consolidated statements of comprehensive income for the years ended July 31, 2019, 2018 and 2017 due to the change in fair value of derivatives not designated as hedging instruments. There was no effect for the year ended July 31, 2019.


	For the year ended July 31, 2018
	Amount of Gain (Loss)		Location of Gain (Loss)
Derivatives Not Designated as Hedging Instruments	Recognized in Income		Reclassified in Income
Commodity derivatives - crude oil	$	(3,470)	Cost of sales - midstream operations


	For the year ended July 31, 2017
	Amount of Gain (Loss)		Location of Gain (Loss)
Derivatives Not Designated as Hedging Instruments	Recognized in Income		Reclassified in Income
Commodity derivatives - crude oil	$	(425)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,090	Operating expense

The changes in derivatives included in accumulated other comprehensive income (loss) (“AOCI”) for the years ended July 31, 2019, 2018 and 2017 were as follows:


	For the year ended July 31,
Gains and losses on derivatives included in AOCI	2019		2018		2017
Beginning balance	$	20,560	$	14,648	$	(9,815)
Change in value of risk management commodity derivatives		(48,184)		30,231		21,659
Reclassification of (gains) losses on commodity hedges to cost of sales - propane and other gas liquids sales, net		12,868		(24,714)		(154)
Change in value of risk management interest rate derivatives		—		—		866
Reclassification of losses on interest rate hedges to interest expense		—		395		2,092
Ending balance	$	(14,756)	$	20,560	$	14,648

Ferrellgas expects to reclassify net losses of approximately $13.3 million to earnings during the next 12 months. These net losses are expected to be offset by increased margins on propane sales commitments Ferrellgas has with its customers that qualify for the normal purchase normal sale exception.

During the years ended July 31, 2019, 2018 and 2017, Ferrellgas had no reclassifications to operations resulting from discontinuance of any cash flow hedges arising from the probability of the original forecasted transactions not occurring within the originally specified period of time defined within the hedging relationship.

As of July 31, 2019, Ferrellgas had financial derivative contracts covering 4.9 million barrels of propane that were entered into as cash flow hedges of forward and forecasted purchases of propane.

Derivative Financial Instruments Credit Risk

Ferrellgas is exposed to credit loss in the event of nonperformance by counterparties to derivative financial and commodity instruments. Ferrellgas’ counterparties principally consist of major energy companies and major U.S. financial institutions. Ferrellgas maintains credit policies with regard to its counterparties that it believes reduce its overall credit risk. These policies include evaluating and monitoring its counterparties’ financial condition, including their credit ratings, and entering into agreements with counterparties that govern credit limits. Certain of these agreements call for the posting of collateral by the counterparty or by Ferrellgas in the forms of letters of credit, parental guarantees or cash. Ferrellgas has concentrations of credit risk associated with derivative financial instruments held by certain derivative financial instrument counterparties. If these counterparties that make up the concentration failed to perform according to the terms of their contracts at July 31, 2019, the maximum amount of loss due to credit risk that, based upon the gross fair values of the derivative financial instruments, Ferrellgas would incur is zero.

From time to time Ferrellgas enters into derivative contracts that have credit-risk-related contingent features which dictate credit limits based upon Ferrellgas’ debt rating. There were no open derivative contracts with credit-risk-related contingent features as of July 31, 2019.

Derivative Instruments and Hedging Activities

Derivative [Line Items]

L. Derivative instruments and hedging activities

Ferrellgas, L.P. is exposed to certain market risks related to its ongoing business operations. These risks include exposure to changing commodity prices as well as fluctuations in interest rates. Ferrellgas, L.P. utilizes derivative instruments to manage its exposure to fluctuations in commodity prices. Of these, the propane commodity derivative instruments are designated as cash flow hedges. Prior to the sale of Bridger Energy, LLC in January 2018, all other commodity derivative instruments neither qualified nor were designated as cash flow hedges; therefore, the change in their fair value is recorded currently in earnings. Ferrellgas, L.P. may periodically utilize derivative instruments to manage its exposure to fluctuations in interest rates.

Derivative instruments and hedging activity

During the year ended July 31, 2019 and 2018, Ferrellgas, L.P. did not recognize any gain or loss in earnings related to hedge ineffectiveness and did not exclude any component of financial derivative contract gains or losses from the assessment of hedge effectiveness related to commodity cash flow hedges.

The following tables provide a summary of the fair value of derivatives within Ferrellgas, L.P.’s consolidated balance sheets as of July 31, 2019 and 2018:


	July 31, 2019
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	910	Other current liabilities	$	14,198
Commodity derivatives-propane	Other assets, net		349	Other liabilities		1,817
	Total	$	1,259	Total	$	16,015


	July 31, 2018
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	17,123	Other current liabilities	$	1,832
Commodity derivatives-propane	Other assets, net		5,347	Other liabilities		78
	Total	$	22,470	Total	$	1,910

Ferrellgas, L.P.’s exchange traded commodity derivative contracts require cash margin deposit as collateral for contracts that are in a negative mark-to-market position. These cash margin deposits will be returned if mark-to-market conditions improve or will be applied against cash settlement when the contracts are settled. Liabilities represent cash margin deposits received by Ferrellgas, L.P. for contracts that are in a positive mark-to-market position. The following tables provide a summary of cash margin balances as of July 31, 2019 and July 31, 2018, respectively:


	July 31, 2019
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	25,028	Other current liabilities	$	1,217
	Other assets, net		2,969	Other liabilities		—
		$	27,997		$	1,217


	July 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	2,851	Other current liabilities	$	12,308
	Other assets, net		927	Other liabilities		4,235
		$	3,778		$	16,543

During fiscal 2018, Ferrellgas, L.P. terminated the interest rate swaps that were designated as a fair value hedging instrument and cash flow hedging instrument. Upon termination, Ferrellgas, L.P. paid the counterparty $4.2 million. Since the interest rate swap designated as a fair value hedging instrument that was terminated involves a hedge of an interest-bearing liability, the senior notes due May 1, 2021, Ferrellgas, L.P. capitalized the fair value of the hedge at termination of $4.2 million and will amortize the balance on a straight-line basis to interest expense over the remaining useful life of the hedged item, the 2021 Notes. For information on the interest rate swap terminations, see Note H – Debt. The following table provides a summary of the effect on Ferrellgas, L.P.’s consolidated statements of comprehensive income for the years ended July 31, 2019, 2018 and 2017 due to derivatives designated as fair value hedging instruments:


								Amount of Interest Expense
	Location of Gain	Amount of Gain Recognized on						Recognized on Fixed-Rated Debt
	Recognized on	Derivative						(Related Hedged Item)
Derivative Instrument	Derivative	For the year ended July 31,						For the year ended July 31,
		2019		2018		2017		2019		2018		2017
Interest rate swap agreements	Interest expense	$	—	$	266	$	1,319	$	—	$	(6,825)	$	(9,100)

The following tables provide a summary of the effect on Ferrellgas, L.P.’s consolidated statements of comprehensive income for the years ended July 31, 2019, 2018 and 2017 due to derivatives designated as cash flow hedging instruments:


	For the year ended July 31, 2019
				Amount of Gain (Loss)
			Location of Gain (Loss)	Reclassified from
	Amount of Gain (Loss)		Reclassified from AOCI	AOCI into Income
Derivative Instrument	Recognized in AOCI		into Income	Effective portion		Ineffective portion
Commodity derivatives	$	(48,184)	Cost of product sold- propane and other gas liquids sales	$	(12,868)	$	—
	$	(48,184)		$	(12,868)	$	—


	For the year ended July 31, 2018
				Amount of Gain (Loss)
			Location of Gain (Loss)	Reclassified from
	Amount of Gain (Loss)		Reclassified from AOCI	AOCI into Income
Derivative Instrument	Recognized in AOCI		into Income	Effective portion		Ineffective portion
Commodity derivatives	$	30,231	Cost of product sold- propane and other gas liquids sales	$	24,714	$	—
Interest rate swap agreements		—	Interest expense		(395)		—
	$	30,231		$	24,319	$	—


	For the year ended July 31, 2017
				Amount of Gain (Loss)
			Location of Gain (Loss)	Reclassified from
	Amount of Gain (Loss)		Reclassified from AOCI	AOCI into Income
Derivative Instrument	Recognized in AOCI		into Income	Effective portion		Ineffective portion
Commodity derivatives	$	21,659	Cost of sales-propane and other gas liquids sales	$	154	$	—
Interest rate swap agreements		866	Interest expense		(2,092)		—
	$	22,525		$	(1,938)	$	—

The following table provides a summary of the effect on Ferrellgas, L.P.’s consolidated statements of comprehensive income for the years ended July 31, 2019, 2018and 2017 due to the change in fair value of derivatives not designated as hedging instruments. There was no effect for the fiscal year ended July 31, 2019.


	For the year ended July 31, 2018
	Amount of Gain (Loss)		Location of Gain (Loss)
Derivatives Not Designated as Hedging Instruments	Recognized in Income		Reclassified in Income
Commodity derivatives - crude oil	$	(3,470)	Cost of sales - midstream operations


	For the year ended July 31, 2017
	Amount of Gain (Loss)		Location of Gain (Loss)
Derivatives Not Designated as Hedging Instruments	Recognized in Income		Reclassified in Income
Commodity derivatives - crude oil	$	(425)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,090	Operating expense

The changes in derivatives included in accumulated other comprehensive income (loss) (“AOCI”) for the years ended July 31, 2019, 2018 and 2017 were as follows:


	For the year ended July 31,
Gains and losses on derivatives included in AOCI	2019		2018		2017
Beginning balance	$	20,560	$	14,648	$	(9,815)
Change in value of risk management commodity derivatives		(48,184)		30,231		21,659
Reclassification of (gains) losses on commodity hedges to cost of sales - propane and other gas liquids sales, net		12,868		(24,714)		(154)
Change in value of risk management interest rate derivatives		—		—		866
Reclassification of losses on interest rate hedges to interest expense		—		395		2,092
Ending balance	$	(14,756)	$	20,560	$	14,648

Ferrellgas, L.P. expects to reclassify net losses of approximately $13.3 million to earnings during the next 12 months. These net losses are expected to be offset by increased margins on propane sales commitments Ferrellgas, L.P. has with its customers that qualify for the normal purchase normal sale exception.

During the years ended July 31, 2019, 2018 and 2017, Ferrellgas, L.P. had no reclassifications to operations resulting from discontinuance of any cash flow hedges arising from the probability of the original forecasted transactions not occurring within the originally specified period of time defined within the hedging relationship.

As of July 31, 2019, Ferrellgas, L.P. had financial derivative contracts covering 4.9 million barrels of propane that were entered into as cash flow hedges of forward and forecasted purchases of propane.

Derivative Financial Instruments Credit Risk

Ferrellgas, L.P. is exposed to credit loss in the event of nonperformance by counterparties to derivative financial and commodity instruments. Ferrellgas, L.P.’s counterparties principally consist of major energy companies and major U.S. financial institutions. Ferrellgas, L.P. maintains credit policies with regard to its counterparties that it believes reduce its overall credit risk. These policies include evaluating and monitoring its counterparties’ financial condition, including their credit ratings, and entering into agreements with counterparties that govern credit limits. Certain of these agreements call for the posting of collateral by the counterparty or by Ferrellgas, L.P. in the forms of letters of credit, parental guarantees or cash. Ferrellgas, L.P. has concentrations of credit risk associated with derivative financial instruments held by certain derivative financial instrument counterparties. If these counterparties that make up the concentration failed to perform according to the terms of their contracts at July 31, 2019, the maximum amount of loss due to credit risk that, based upon the gross fair values of the derivative financial instruments, Ferrellgas, L.P. would incur is zero.

From time to time Ferrellgas, L.P. enters into derivative contracts that have credit-risk-related contingent features which dictate credit limits based upon Ferrellgas, L.P.’s debt rating. There were no open derivative contracts with credit-risk-related contingent features as of July 31, 2019.

Transactions With Related Parties

12 Months Ended

Jul. 31, 2019

M. Transactions with related parties

Ferrellgas has no employees and is managed and controlled by its general partner. Pursuant to Ferrellgas’ partnership agreements, the general partner is entitled to reimbursement for all direct and indirect expenses incurred or payments it makes on behalf of Ferrellgas and all other necessary or appropriate expenses allocable to Ferrellgas or otherwise reasonably incurred by its general partner in connection with operating Ferrellgas’ business. These costs primarily include compensation and benefits paid to employees of the general partner who perform services on Ferrellgas’ behalf and are reported in the consolidated statements of operations as follows:


	For the year ended July 31,
	2019		2018		2017
Operating expense	$	256,190	$	243,407	$	228,969

General and administrative expense	$	25,368	$	28,282	$	31,068

See additional discussions about transactions with the general partner and related parties in Note I – Partners’ deficit.

M. Transactions with related parties

Ferrellgas, L.P. has no employees and is managed and controlled by its general partner. Pursuant to Ferrellgas, L.P.’s partnership agreement, the general partner is entitled to reimbursement for all direct and indirect expenses incurred or payments it makes on behalf of Ferrellgas, L.P., and all other necessary or appropriate expenses allocable to Ferrellgas, L.P. or otherwise reasonably incurred by its general partner in connection with operating Ferrellgas, L.P.’s business. These costs primarily include compensation and benefits paid to employees of the general partner who perform services on Ferrellgas, L.P.’s behalf and are reported in the consolidated statements of operations as follows:


	For the year ended July 31,
	2019		2018		2017
Operating expense	$	256,190	$	243,407	$	228,969

General and administrative expense	$	25,368	$	28,282	$	31,068

See additional discussions about transactions with the general partner and related parties in Note I – Partners’ deficit.

Contingencies And Commitments

12 Months Ended

Jul. 31, 2019

Ferrellgas Partners Finance Corp. [Member]

N. Contingencies and commitments

Litigation

Ferrellgas’ operations are subject to all operating hazards and risks normally incidental to handling, storing, transporting and otherwise providing for use by consumers of combustible liquids such as propane and, prior to the sales of midstream operations in fiscal 2018, crude oil. As a result, at any given time, Ferrellgas can be threatened with or named as a defendant in various lawsuits arising in the ordinary course of business. Other than as discussed below, Ferrellgas is not a party to any legal proceedings other than various claims and lawsuits arising in the ordinary course of business. It is not possible to determine the ultimate disposition of these matters; however, management is of the opinion that there are no known claims or contingent claims that are reasonably expected to have a material adverse effect on the consolidated financial condition, results of operations and cash flows of Ferrellgas.

Ferrellgas has been named as a defendant, along with a competitor, in putative class action lawsuits filed in multiple jurisdictions. The lawsuits, which were consolidated in the Western District of Missouri on October 16, 2014, allege that Ferrellgas and a competitor coordinated in 2008 to reduce the fill level in barbeque cylinders and combined to persuade a common customer to accept that fill reduction, resulting in increased cylinder costs to direct customers and end-user customers in violation of federal and certain state antitrust laws. The lawsuits seek treble damages, attorneys’ fees, injunctive relief and costs on behalf of the putative class. These lawsuits have been coordinated for pretrial purposes by the multidistrict litigation panel. The Federal Court for the Western District of Missouri initially dismissed all claims brought by direct and indirect customers other than state law claims of indirect customers under Wisconsin, Maine and Vermont law. The direct customer plaintiffs filed an appeal, which resulted in a reversal of the district court’s dismissal. We filed a petition for a writ of certiorari which was denied. An appeal by the indirect customer plaintiffs resulted in the court of appeals affirming the dismissal of the federal claims and remanding the case to the district court to decide whether to exercise supplemental jurisdiction over the remaining state law claims. Thereafter, in August 2019, Ferrellgas reached a settlement with the direct customers, pursuant to which it agreed to pay a total of $6.25 million to resolve all claims asserted by the putative direct purchaser class. With respect to the indirect customers, the district court exercised supplemental jurisdiction over the remaining state law claims, but then granted in part Ferrellgas’ pleadings-based motion and dismissed 11 of the 24 remaining state law claims. As a result, there are 13 remaining state law claims brought by a putative class of indirect customers. Ferrellgas believes it has strong defenses and intends to vigorously defend itself against these remaining claims. Ferrellgas does not believe loss is probable or reasonably estimable at this time related to the putative class action lawsuit.

Ferrellgas was named, along with several former officers, in several class action lawsuits alleging violations of certain securities laws based on alleged materially false and misleading statements in certain of our public disclosures. On April 24, 2019 the United States Court of Appeals for the Second Circuit affirmed the judgment of the Southern District Court dismissing the class action lawsuits with prejudice. The derivative lawsuits have been voluntarily dismissed, pending court approval. Ferrellgas does not believe loss is probable or reasonably estimable at this time related to the derivative lawsuits.

Ferrellgas and Bridger Logistics, LLC, have been named, along with two former officers, in a lawsuit filed by Eddystone Rail Company ("Eddystone") on February 2, 2017 in the Eastern District of Pennsylvania (the "EDPA Lawsuit"). Eddystone indicated that it has prevailed in or settled an arbitration against Jamex Transfer Services (“JTS”), previously named Bridger Transfer Services, a former subsidiary of Bridger Logistics, LLC (“Bridger”). The arbitration involved a claim against JTS for money due for deficiency payments under a contract for the use of an Eddystone facility used to offload crude from rail onto barges. Eddystone alleges that Ferrellgas transferred assets out of JTS prior to the sale of the membership interest in JTS to Jamex Transfer Holdings, and that those transfers should be avoided so that the assets can be used to satisfy the amount owed by JTS to Eddystone as a result of the arbitration. Eddystone also alleges that JTS was an “alter ego” of Bridger and Ferrellgas and that Bridger and Ferrellgas breached fiduciary duties owed to Eddystone as a creditor of JTS. Ferrellgas believes that Ferrellgas and Bridger have valid defenses to these claims and to Eddystone’s primary claim against JTS for breach of contract. The lawsuit does not specify a specific amount of damages that Eddystone is seeking; however, Ferrellgas believes that the amount of such damages, if ultimately owed to Eddystone, could be material to Ferrellgas. Ferrellgas intends to vigorously defend this claim. On August 24, 2017, Ferrellgas filed a third-party complaint against JTS, Jamex Transfer Holdings, and other related persons and entities (the "Third-Party Defendants"), asserting claims for breach of contract, indemnification of any losses in the EDPA Lawsuit, tortious interference with contract, and contribution. On June 25, 2018, Ferrellgas entered into an agreement with the Third-Party Defendants which, among other things, resulted in a dismissal of the claims against the Third-Party Defendants from the lawsuit. The lawsuit is in the discovery stage; as such, management does not currently believe a loss is probable or reasonably estimable at this time.

Long-term debt-related commitments

Ferrellgas has long and short-term payment obligations under agreements such as the indentures governing its senior notes and its Senior Secured Credit Facility. See Note H – Debt – for a description of these debt obligations and a schedule of future maturities.

Operating lease commitments and buyouts

Ferrellgas leases certain property, plant and equipment under non-cancelable and cancelable operating leases. Amounts shown in the table below represent minimum lease payment obligations under Ferrellgas’ third-party operating leases with terms in excess of one year for the periods indicated. These arrangements include the leasing of transportation equipment, property, computer equipment and propane tanks. Ferrellgas accounts for these arrangements as operating leases.

Ferrellgas is required to recognize a liability for the fair value of guarantees. The only material guarantees Ferrellgas has are associated with residual value guarantees of operating leases. Most of the operating leases involving Ferrellgas’ transportation equipment contain residual value guarantees. These transportation equipment lease arrangements are scheduled to expire over the next seven fiscal years. Most of these arrangements provide that the fair value of the equipment at the end of the lease term will equal or exceed a guaranteed amount, or Ferrellgas will be required to pay the lessor the difference. The fair value of these residual value guarantees was $1.5 million as of July 31, 2019. Although the fair values of the underlying equipment at the end of the lease terms have historically exceeded these guaranteed amounts, the maximum potential amount of aggregate future payments Ferrellgas could be required to make under these leasing arrangements, assuming the equipment is worthless at the end of the lease term, was $9.6 million as of July 31, 2019. Ferrellgas does not know of any event, demand, commitment, trend or uncertainty that would result in a material change to these arrangements.

Operating lease buyouts represent the maximum amount Ferrellgas would pay if it were to exercise its right to buyout the assets at the end of their lease term.

The following table summarizes Ferrellgas’ contractual operating lease commitments and buyout obligations as of July 31, 2019:


	Future minimum rental and buyout amounts by fiscal year
	2020		2021		2022		2023		2024		Thereafter
Operating lease obligations	$	44,392	$	36,134	$	26,312	$	20,432	$	17,196	$	17,414
Operating lease buyouts	$	3,073	$	4,371	$	6,421	$	3,527	$	1,238	$	14,433

Rental expense under these leases totaled $53.8 million, $50.7 million and $50.0 million for fiscal 2019, 2018 and 2017, respectively.

Exit costs

During the year ended July 31, 2018, Ferrellgas recognized exit costs associated with a crude oil storage agreement that is no longer being utilized, primarily due to the various Midstream dispositions described in Note C – Acquisitions, dispositions and other significant transactions, and for which Ferrellgas does not anticipate any future economic benefit. The $11.8 million charge was recorded in “cost of sales - midstream operations” in the consolidated statements of operations. The following provides the activity in the exit costs liability included in “Other liabilities” within the consolidated balance sheets:


	Contract exit
	costs
July 31, 2017	$	—
Net expense		11,804
Cash payments and other		—
July 31, 2018		11,804
Accretion		448
Cash payments and other		(802)
July 31, 2019	$	11,450

B. Contingencies and commitments

The Finance Corp. serves as co-issuer and co-obligor for debt securities of the Partnership. The Finance Corp. is liable as co-issuer and co-obligor for the $357 million aggregate principal amount of the Partnership’s unsecured senior notes due June 15, 2020, which obligation is only reported on the Partnership’s consolidated balance sheet.

Ferrellgas Finance Corp. [Member]

N. Contingencies and commitments

Litigation

Ferrellgas, L.P.’s operations are subject to all operating hazards and risks normally incidental to handling, storing, transporting and otherwise providing for use by consumers of combustible liquids such as propane and, prior to the sales of midstream operations in fiscal 2018, crude oil. As a result, at any given time, Ferrellgas, L.P. can be threatened with or named as a defendant in various lawsuits arising in the ordinary course of business. Other than as discussed below, Ferrellgas, L.P. is not a party to any legal proceedings other than various claims and lawsuits arising in the ordinary course of business. It is not possible to determine the ultimate disposition of these matters; however, management is of the opinion that there are no known claims or contingent claims that are reasonably expected to have a material adverse effect on the consolidated financial condition, results of operations and cash flows of Ferrellgas, L.P.

Ferrellgas, L.P. has been named as a defendant, along with a competitor, in putative class action lawsuits filed in multiple jurisdictions. The lawsuits, which were consolidated in the Western District of Missouri on October 16, 2014, allege that Ferrellgas and a competitor coordinated in 2008 to reduce the fill level in barbeque cylinders and combined to persuade a common customer to accept that fill reduction, resulting in increased cylinder costs to direct customers and end-user customers in violation of federal and certain state antitrust laws. The lawsuits seek treble damages, attorneys’ fees, injunctive relief and costs on behalf of the putative class. These lawsuits have been coordinated for pretrial purposes by the multidistrict litigation panel. The Federal Court for the Western District of Missouri initially dismissed all claims brought by direct and indirect customers other than state law claims of indirect customers under Wisconsin, Maine and Vermont law. The direct customer plaintiffs filed an appeal, which resulted in a reversal of the district court’s dismissal. We filed a petition for a writ of certiorari which was denied. An appeal by the indirect customer plaintiffs resulted in the court of appeals affirming the dismissal of the federal claims and remanding the case to the district court to decide whether to exercise supplemental jurisdiction over the remaining state law claims. Thereafter, in August 2019, Ferrellgas, L.P. reached a settlement with the direct customers, pursuant to which it agreed to pay a total of $6.25 million to resolve all claims asserted by the putative direct purchaser class. With respect to the indirect customers, the district court exercised supplemental jurisdiction over the remaining state law claims, but then granted in part Ferrellgas’ pleadings-based motion and dismissed 11 of the 24 remaining state law claims. As a result, there are 13 remaining state law claims brought by a putative class of indirect customers. Ferrellgas, L.P. believes it has strong defenses and intends to vigorously defend itself against these remaining claims. Ferrellgas, L.P. does not believe loss is probable or reasonably estimable at this time related to the putative class action lawsuit.

Ferrellgas, L.P. was named, along with several former officers, in several class action lawsuits alleging violations of certain securities laws based on alleged materially false and misleading statements in certain of our public disclosures. On April 24, 2019 the United States Court of Appeals for the Second Circuit affirmed the judgment of the Southern District Court dismissing the class action lawsuits with prejudice. The derivative lawsuits have been voluntarily dismissed, pending court approval. Ferrellgas, L.P. does not believe loss is probable or reasonably estimable at this time related to the derivative lawsuits.

Ferrellgas, L.P. and Bridger Logistics, LLC, have been named, along with two former officers, in a lawsuit filed by Eddystone Rail Company ("Eddystone") on February 2, 2017 in the Eastern District of Pennsylvania (the "EDPA Lawsuit"). Eddystone indicated that it has prevailed in or settled an arbitration against Jamex Transfer Services (“JTS”), previously named Bridger Transfer Services, a former subsidiary of Bridger Logistics, LLC (“Bridger”). The arbitration involved a claim against JTS for money due for deficiency payments under a contract for the use of an Eddystone facility used to offload crude from rail onto barges. Eddystone alleges that Ferrellgas transferred assets out of JTS prior to the sale of the membership interest in JTS to Jamex Transfer Holdings, and that those transfers should be avoided so that the assets can be used to satisfy the amount owed by JTS to Eddystone as a result of the arbitration. Eddystone also alleges that JTS was an “alter ego” of Bridger and Ferrellgas and that Bridger and Ferrellgas breached fiduciary duties owed to Eddystone as a creditor of JTS. Ferrellgas believes that Ferrellgas and Bridger have valid defenses to these claims and to Eddystone’s primary claim against JTS for breach of contract. The lawsuit does not specify a specific amount of damages that Eddystone is seeking; however, Ferrellgas believes that the amount of such damages, if ultimately owed to Eddystone, could be material to Ferrellgas. Ferrellgas intends to vigorously defend this claim. On August 24, 2017, Ferrellgas filed a third-party complaint against JTS, Jamex Transfer Holdings, and other related persons and entities (the "Third-Party Defendants"), asserting claims for breach of contract, indemnification of any losses in the EDPA Lawsuit, tortious interference with contract, and contribution. On June 25, 2018, Ferrellgas entered into an agreement with the Third-Party Defendants which, among other things, resulted in a dismissal of the claims against the Third-Party Defendants from the lawsuit. The lawsuit is in the discovery stage; as such, management does not currently believe a loss is probable or reasonably estimable at this time.

Long-term debt-related commitments

Ferrellgas, L.P. has long and short-term payment obligations under agreements such as the indentures governing its senior notes and its credit facility. See Note H – Debt – for a description of these debt obligations and a schedule of future maturities.

Operating lease commitments and buyouts

Ferrellgas, L.P. leases certain property, plant and equipment under non-cancelable and cancelable operating leases. Amounts shown in the table below represent minimum lease payment obligations under Ferrellgas, L.P.’s third-party operating leases with terms in excess of one year for the periods indicated. These arrangements include the leasing of transportation equipment, property, computer equipment and propane tanks. Ferrellgas, L.P. accounts for these arrangements as operating leases.

Ferrellgas, L.P. is required to recognize a liability for the fair value of guarantees. The only material guarantees Ferrellgas, L.P. has are associated with residual value guarantees of operating leases. Most of the operating leases involving Ferrellgas, L.P.’s transportation equipment contain residual value guarantees. These transportation equipment lease arrangements are scheduled to expire over the next seven fiscal years. Most of these arrangements provide that the fair value of the equipment at the end of the lease term will equal or exceed a guaranteed amount, or Ferrellgas, L.P. will be required to pay the lessor the difference. The fair value of these residual value guarantees was $1.5 million as of July 31, 2019. Although the fair values of the underlying equipment at the end of the lease terms have historically exceeded these guaranteed amounts, the maximum potential amount of aggregate future payments Ferrellgas, L.P. could be required to make under these leasing arrangements, assuming the equipment is worthless at the end of the lease term, was $9.6 million as of July 31, 2019. Ferrellgas, L.P. does not know of any event, demand, commitment, trend or uncertainty that would result in a material change to these arrangements.

Operating lease buyouts represent the maximum amount Ferrellgas, L.P. would pay if it were to exercise its right to buyout the assets at the end of their lease term.

The following table summarizes Ferrellgas, L.P.’s contractual operating lease commitments and buyout obligations as of July 31, 2019:


	Future minimum rental and buyout amounts by fiscal year
	2020		2021		2022		2023		2024		Thereafter
Operating lease obligations	$	44,392	$	36,134	$	26,312	$	20,432	$	17,196	$	17,414
Operating lease buyouts		3,073		4,371		6,421		3,527		1,238		14,433

Rental expense under these leases totaled $53.8 million, $50.7 million and $50.0 million for fiscal 2019, 2018 and 2017, respectively.

Exit costs


	Contract exit
	costs
July 31, 2017	$	—
Net expense		11,804
Cash payments and other		—
July 31, 2018		11,804
Accretion		448
Cash payments and other		(802)
July 31, 2019	$	11,450

Net Earnings (Loss) Per Common Unitholders' Interest

B. Contingencies and commitments

The Finance Corp. serves as co-issuer and co-obligor for debt securities of the Partnership. The Finance Corp. is liable as co-issuer and co-obligor for (i) the $500 million aggregate principal amount of the Partnership’s unsecured senior notes due 2021, (ii) the $475 million aggregate principal amount of the Partnership’s unsecured senior notes due 2022, and (iii) the $500 million aggregate principal amount of the Partnership’s unsecured senior notes due 2023, which obligations are only reported on the Partnership’s consolidated balance sheet.

Employee Benefits	12 Months Ended
Employee Benefits	Jul. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Benefits	O. Employee benefits Ferrellgas has no employees and is managed and controlled by its general partner. Ferrellgas assumes all liabilities, which include specific liabilities related to the following employee benefit plans for the benefit of the officers and employees of the general partner. Ferrell Companies makes contributions to the employee stock ownership trust ( the “Trust”), which causes a portion of the shares of Ferrell Companies owned by the Trust to be allocated to employees’ accounts over time. The allocation of Ferrell Companies’ shares to employee accounts causes a non-cash compensation charge to be incurred by Ferrellgas, equivalent to the fair value of such shares allocated. This non-cash compensation charge is reported separately in Ferrellgas’ consolidated statements of operations and thus is excluded from operating and general and administrative expenses. The non-cash compensation charges were $5.7 million, $13.9 million and $15.1 million during fiscal 2019, 2018 and 2017, respectively. Ferrellgas is not obligated to fund or make contributions to the Trust. The general partner and its parent, Ferrell Companies, have a defined contribution 401(k) investment plan which covers substantially all employees. The plan, which qualifies under section 401(k) of the Internal Revenue Code, also provides for matching contributions under a cash or deferred arrangement based upon participant salaries and employee contributions to the plan. Matching contributions for fiscal 2019, 2018 and 2017 were $4.6 million, $3.7 million and $4.2 million, respectively. The general partner terminated its defined benefit plan on December 15, 2018. Prior to termination, this plan provided participants who were covered under a previously terminated plan with a guaranteed retirement benefit at least equal to the benefit they would have received under the prior terminated plan. Until July 31, 1999, benefits under the terminated plan were determined by years of credited service and salary levels. As of July 31, 1999, years of credited service and salary levels were frozen. The general partner’s prior funding policy for this plan was to contribute amounts deductible for Federal income tax purposes and invest the plan assets primarily in corporate stocks and bonds, U.S. Treasury bonds and short-term cash investments. During fiscal 2019, 2018 and 2017, other comprehensive income and other liabilities were adjusted by $(0.1) million, $0.1 million and $0.5 million, respectively.
Ferrellgas, L.P. [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Benefits	O. Employee benefits Ferrellgas, L.P. has no employees and is managed and controlled by its general partner. Ferrellgas, L.P. assumes all liabilities, which include specific liabilities related to the following employee benefit plans for the benefit of the officers and employees of the general partner. Ferrell Companies makes contributions to the employee stock ownership trust ( the “Trust”), which causes a portion of the shares of Ferrell Companies owned by the Trust to be allocated to employees’ accounts over time. The allocation of Ferrell Companies’ shares to employee accounts causes a non-cash compensation charge to be incurred by Ferrellgas, L.P., equivalent to the fair value of such shares allocated. This non-cash compensation charge is reported separately in Ferrellgas, L.P.’s consolidated statements of operations and thus is excluded from operating and general and administrative expenses. The non-cash compensation charges were $5.7 million, $13.9 million and $15.1 million during fiscal 2019, 2018 and 2017, respectively. Ferrellgas, L.P. is not obligated to fund or make contributions to the Trust. The general partner and its parent, Ferrell Companies, have a defined contribution 401(k) investment plan which covers substantially all employees. The plan, which qualifies under section 401(k) of the Internal Revenue Code, also provides for matching contributions under a cash or deferred arrangement based upon participant salaries and employee contributions to the plan. Matching contributions for fiscal 2019, 2018 and 2017 were $4.6 million, $3.7 million and $4.2 million, respectively. The general partner terminated its defined benefit plan on December 15, 2018. Prior to termination, this plan provided participants who were covered under a previously terminated plan with a guaranteed retirement benefit at least equal to the benefit they would have received under the prior terminated plan. Until July 31, 1999, benefits under the terminated plan were determined by years of credited service and salary levels. As of July 31, 1999, years of credited service and salary levels were frozen. The general partner’s prior funding policy for this plan was to contribute amounts deductible for Federal income tax purposes and invest the plan assets primarily in corporate stocks and bonds, U.S. Treasury bonds and short-term cash investments. During fiscal 2019, 2018 and 2017, other comprehensive income and other liabilities were adjusted by $(0.1) million, $0.1 million and $0.5 million, respectively.

Net Earnings (Loss) Per Common Unitholders' Interest

12 Months Ended

Jul. 31, 2019

Earnings Per Share [Abstract]

P. Net loss per common unitholders’ interest

Below is a calculation of the basic and diluted net earnings per common unitholders’ interest in the consolidated statements of operations for the periods indicated. In accordance with guidance issued by the FASB regarding participating securities and the two-class method, Ferrellgas calculates net loss per common unitholders’ interest for each period presented according to distributions declared and participation rights in undistributed earnings, as if all of the earnings or loss for the period had been distributed. Due to the seasonality of Ferrellgas’ business, the dilutive effect of the two-class method typically impacts only the three months ending January 31. In periods with undistributed earnings above certain levels, the calculation according to the two-class method results in an increased allocation of undistributed earnings to the general partner and a dilution of the earnings to the limited partners as follows.


	Ratio of total distributions payable to:
Quarterly distribution per common unit	Common unitholder		General partner
$0.56 to $0.63	86.9	%	13.1	%
$0.64 to $0.82	76.8	%	23.2	%
$0.83 and above	51.5	%	48.5	%

There was not a dilutive effect resulting from this guidance on basic and diluted net earnings per common unitholders’ interest for fiscal 2019, 2018 and 2017.

In periods with net losses, the allocation of the net losses to the limited partners and the general partner will be determined based on the same allocation basis specified in the Ferrellgas Partners’ partnership agreement that would apply to periods in which there were no undistributed earnings. Additionally, in periods with net losses, there are no dilutive securities.


	For the year ended July 31,
	2019		2018		2017

Common unitholders’ interest in net loss	$	(63,605)	$	(252,035)	$	(53,665)
Weighted average common units outstanding (in thousands)		97,152.7		97,152.7		97,229.5
Basic and diluted net loss per common unit	$	(0.65)	$	(2.59)	$	(0.55)

Segment Reporting

12 Months Ended

Jul. 31, 2019

Segment Reporting Disclosure

Q. Segment reporting

As of July 31, 2019, Ferrellgas has one reportable operating segment: propane operations and related equipment sales. All remaining activities are included in Corporate and other. (See Note C – Acquisitions, dispositions and other significant transactions.)

The chief operating decision maker evaluates the operating segments and allocates resources using an Adjusted EBITDA performance measure which is based on earnings (loss) before income tax expense (benefit), interest expense, depreciation and amortization expense, non-cash employee stock ownership plan compensation charge, non-cash stock-based compensation charge, asset impairments, loss on asset sales and disposals, other income (expense), net, severance costs, legal fees and settlements related to non-core businesses, unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments, exit costs associated with contracts related to the Midstream dispositions and net earnings (loss) attributable to noncontrolling interests. This performance measure is not a GAAP measure, however the components are computed using amounts that are determined in accordance with GAAP. A reconciliation of this performance measure to net loss attributable to Ferrellgas Partners L.P., which is its nearest comparable GAAP measure, is included in the tables below. In management’s evaluation of performance, certain costs, such as compensation for administrative staff and executive management, are not allocated by segment and, accordingly, the following reportable segment results do not include such unallocated costs. The accounting policies of the operating segments are otherwise the same as those described in the summary of significant accounting policies in Note B – Summary of significant accounting policies.

Assets reported within a segment are those assets that can be identified to a segment and primarily consist of trade receivables, property, plant and equipment, inventories, identifiable intangible assets and goodwill. Cash, certain prepaid assets and other assets are not allocated to segments. Although Ferrellgas can and does identify long-lived assets such as property, plant and equipment and identifiable intangible assets to reportable segments, Ferrellgas does not allocate the related depreciation and amortization to the segment as management evaluates segment performance exclusive of these non-cash charges.

The propane operations and related equipment sales segment primarily includes the distribution and sale of propane and related equipment and supplies with concentrations in the Midwest, Southeast, Southwest and Northwest regions of the United States. Sales from propane distribution are generated principally from transporting propane purchased from third parties to propane distribution locations and then to tanks on customers’ premises or to portable propane tanks delivered to nationwide and local retailers. Sales from portable tank exchanges, nationally branded under the name Blue Rhino, are generated primarily through a network of partnership-owned distribution outlets, and to a lesser extent, through independently-owned distribution outlets.

Until April 2018, Ferrellgas reported two reportable segments: the Propane operations and related equipment sales segment and the Midstream operations segment. During July 2018, Ferrellgas sold substantially all of the midstream operations. As a result of a change in the way management is evaluating results and allocating resources, results of the Midstream operations business are now included in the Corporate and other operations for all periods presented and our only reportable segment is Propane operations and related equipment sales.

Following is a summary of segment information for the years ended July 31, 2019, 2018 and 2017.


	Year ended July 31, 2019
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,684,392	$	—	$	1,684,392
Direct costs (1)		1,412,390		41,979		1,454,369
Adjusted EBITDA	$	272,002	$	(41,979)	$	230,023


	Year ended July 31, 2018
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,790,823	$	282,319	$	2,073,142
Direct costs (1)		1,514,755		316,468		1,831,223
Adjusted EBITDA	$	276,068	$	(34,149)	$	241,919


	Year ended July 31, 2017
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,463,574	$	466,703	$	1,930,277
Direct costs (1)		1,198,150		502,064		1,700,214
Adjusted EBITDA	$	265,424	$	(35,361)	$	230,063

(1)

Direct costs are comprised of “cost of sales-propane and other gas liquids sales”, “cost of sales-other”, “cost of sales-midstream operations”, “operating expense”, “general and administrative expense”, and “equipment lease expense” less “severance costs”, “legal fees and settlements related to non-core businesses”, “non-cash stock-based compensation charge”, “asset impairments”, “exit costs associated with contracts - Midstream dispositions”, “multi-employer pension plan withdrawal settlement” and “unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments”.

Following is a reconciliation of Net loss attributable to Ferrellgas Partners, L.P. to the total segment performance measures of EBITDA and Adjusted EBITDA:


	Year ended July 31,
	2019		2018		2017
Net loss attributable to Ferrellgas Partners, L.P.	$	(64,247)	$	(254,581)	$	(54,207)
Income tax expense (benefit)		323		(2,678)		(1,143)
Interest expense		177,619		168,467		152,485
Depreciation and amortization expense		78,846		101,795		103,351
EBITDA		192,541		13,003		200,486
Non-cash employee stock ownership plan compensation charge		5,693		13,859		15,088
Non-cash stock-based compensation charge		—		—		3,298
Asset impairments		—		10,005		—
Loss on asset sales and disposals		10,968		187,399		14,457
Other income, net		(369)		(928)		(1,474)
Severance costs		1,600		1,663		1,959
Legal fees and settlements related to non-core businesses		18,364		6,065		—
Unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments		—		1,293		(3,457)
Multi-employer pension plan withdrawal settlement		1,524		—		—
Exit costs associated with contracts - Midstream dispositions		—		11,804		—
Net loss attributable to noncontrolling interest		(298)		(2,244)		(294)
Adjusted EBITDA	$	230,023	$	241,919	$	230,063

Following are total assets by segment:


Assets	July 31, 2019		July 31, 2018
Propane operations and related equipment sales	$	1,223,790	$	1,196,084
Corporate and other		39,169		167,197
Total consolidated assets	$	1,262,959	$	1,363,281

Following are capital expenditures by segment (unaudited):


	Year ended July 31, 2019
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	44,439	$	2,614	$	47,053
Growth		56,145		—		56,145
Total	$	100,584	$	2,614	$	103,198


	Year ended July 31, 2018
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	23,979	$	3,584	$	27,563
Growth		51,229		1,255		52,484
Total	$	75,208	$	4,839	$	80,047


	Year ended July 31, 2017
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	13,330	$	3,808	$	17,138
Growth		28,912		315		29,227
Total	$	42,242	$	4,123	$	46,365

Segment Reporting Disclosure

P. Segment reporting

As of July 31, 2019, Ferrellgas, L.P. has one reportable operating segment: propane operations and related equipment sales. All remaining activities are included in Corporate and other. (See Note C – Acquisitions, dispositions and other significant transactions.)

The chief operating decision maker evaluates the operating segments and allocates resources using an Adjusted EBITDA performance measure which is based on earnings (loss) before income tax expense (benefit), interest expense, depreciation and amortization expense, non-cash employee stock ownership plan compensation charge, non-cash stock-based compensation charge, asset impairments, loss on asset sales and disposals, other income (expense), net, severance costs, legal fees and settlements related to non-core businesses, unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments and exit costs associated with contracts related to the Midstream dispositions. This performance measure is not a GAAP measure, however, the components are computed using amounts that are determined in accordance with GAAP. A reconciliation of this performance measure to net earnings, which is its nearest comparable GAAP measure, is included in the tables below. In management’s evaluation of performance, certain costs, such as compensation for administrative staff and executive management, are not allocated by segment and, accordingly, the following reportable segment results do not include such unallocated costs. The accounting policies of the operating segments are otherwise the same as those described in the summary of significant accounting policies in Note B – Summary of significant accounting policies.

Assets reported within a segment are those assets that can be identified to a segment and primarily consist of trade receivables, property, plant and equipment, inventories, identifiable intangible assets and goodwill. Cash, certain prepaid assets and other assets are not allocated to segments. Although Ferrellgas, L.P. can and does identify long-lived assets such as property, plant and equipment and identifiable intangible assets to reportable segments, Ferrellgas, L.P. does not allocate the related depreciation and amortization to the segment as management evaluates segment performance exclusive of these non-cash charges.

Until April 2018, Ferrellgas, L.P. reported two reportable segments: Propane operations and related equipment sales segment and Midstream operations segment. During July 2018, Ferrellgas, L.P. sold substantially all of the midstream operations. As a result of a change in the way management is evaluating results and allocating resources, results of the Midstream operations business are now included in the Corporate and other operations for all periods presented and our only reportable segment is Propane operations and related equipment sales.

Following is a summary of segment information for the years ended July 31, 2019, 2018 and 2017.


	Year ended July 31, 2019
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,684,392	$	—	$	1,684,392
Direct costs (1)		1,412,299		41,056		1,454,355
Adjusted EBITDA	$	272,093	$	(41,056)	$	230,037


	Year ended July 31, 2018
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,790,823	$	282,319	$	2,073,142
Direct costs (1)		1,514,755		316,331		1,831,086
Adjusted EBITDA	$	276,068	$	(34,012)	$	242,056


	Year ended July 31, 2017
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,463,574	$	466,703	$	1,930,277
Direct costs (1)		1,198,150		501,925		1,700,075
Adjusted EBITDA	$	265,424	$	(35,222)	$	230,202

(1)

Following is a reconciliation of Ferrellgas, L.P.’s net loss to the total segment performance measures of EBITDA and Adjusted EBITDA:


	Year ended July 31,
	2019		2018		2017

Net loss	$	(29,517)	$	(222,146)	$	(29,059)
Income tax expense (benefit)		293		(2,699)		(1,149)
Interest expense		142,635		133,946		127,188
Depreciation and amortization expense		78,846		101,795		103,351
EBITDA		192,257		10,896		200,331
Non-cash employee stock ownership plan compensation charge		5,693		13,859		15,088
Non-cash stock-based compensation charge		—		—		3,298
Asset impairments		—		10,005		—
Loss on asset sales and disposals		10,968		187,399		14,457
Other income, net		(369)		(928)		(1,474)
Severance costs		1,600		1,663		1,959
Legal fees and settlements related to non-core businesses		18,364		6,065		—
Unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments		—		1,293		(3,457)
Multi-employer pension plan withdrawal settlement		1,524		—		—
Exit costs associated with contracts - Midstream dispositions		—		11,804		—
Adjusted EBITDA	$	230,037	$	242,056	$	230,202

Following are total assets by segment:


	July 31, 2019		July 31, 2018
Assets
Propane operations and related equipment sales	$	1,223,790	$	1,196,084
Corporate and other		39,043		167,162
Total consolidated assets	$	1,262,833	$	1,363,246

Following are capital expenditures by segment (unaudited):


	Year ended July 31, 2019
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	44,439	$	2,614	$	47,053
Growth		56,145		—		56,145
Total	$	100,584	$	2,614	$	103,198


	Year ended July 31, 2018
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	23,979	$	3,584	$	27,563
Growth		51,229		1,255		52,484
Total	$	75,208	$	4,839	$	80,047


	Year Ended July 31, 2017
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	13,330	$	3,808	$	17,138
Growth		28,912		315		29,227
Total	$	42,242	$	4,123	$	46,365

Quarterly Data (Unaudited)

12 Months Ended

Jul. 31, 2019

Interim Period, Costs Not Allocable [Line Items]

Quarterly Data

R. Quarterly data (unaudited)

The following summarized unaudited quarterly data includes all adjustments (consisting only of normal recurring adjustments, with the exception of those items indicated below), which Ferrellgas considers necessary for a fair presentation. Due to the seasonality of the propane distribution business, first and fourth quarter Revenues, gross margin from propane and other gas liquids sales, Net earnings (loss) attributable to Ferrellgas Partners and common unitholders’ interest in net earnings (loss) are consistently less than the second and third quarter results. Other factors affecting the results of operations include competitive conditions, demand for product, timing of acquisitions, variations in the weather and fluctuations in propane prices. The sum of basic and diluted net earnings (loss) per common unitholders’ interest by quarter may not equal the basic and diluted net earnings (loss) per common unitholders’ interest for the year due to variations in the weighted average units outstanding used in computing such amounts.


For the year ended July 31, 2019	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	352,309	$	573,377	$	479,625	$	279,081
Gross margin from propane and other gas liquids sales (a)		130,830		238,581		209,167		127,764
Net earnings (loss)		(57,508)		43,875		20,760		(71,672)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.		(57,015)		43,344		20,461		(71,037)
Common unitholders’ interest in net earnings (loss)		(56,445)		42,911		20,256		(70,327)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.58)	$	0.44	$	0.21	$	(0.72)


For the year ended July 31, 2018	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	454,655	$	755,156	$	515,810	$	347,521
Gross margin from propane and other gas liquids sales (a)		123,243		229,321		190,883		126,115
Gross margin from midstream operations (b)		12,635		10,209		8,077		(4,161)
Net earnings (loss) (c)		(48,316)		(1,774)		11,062		(217,797)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.		(47,915)		(1,843)		10,861		(215,684)
Common unitholders’ interest in net earnings (loss)		(47,436)		(1,824)		10,752		(213,527)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.49)	$	(0.02)	$	0.11	$	(2.20)


For the year ended July 31, 2017	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	379,542	$	579,250	$	538,109	$	433,376
Gross margin from propane and other gas liquids sales (a)		123,187		202,346		171,950		126,774
Gross margin from midstream operations (b)		13,402		9,763		7,909		6,190
Net earnings (loss)		(43,471)		38,528		6,691		(56,249)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.		(43,073)		38,098		6,536		(55,768)
Common unitholders’ interest in net earnings (loss)		(42,462)		37,717		6,470		(55,210)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.44)	$	0.39	$	0.07	$	(0.57)

(a)

Gross margin from “Propane and other gas liquids sales” represents “Revenues - propane and other gas liquids sales” less “Cost of sales – propane and other gas liquids sales.”

(b)

Gross margin from “Midstream operations” represents “Revenues - midstream operations” less “Cost of sales - midstream operations.”

(c)

Includes asset impairment charges of $10.0 million in the second quarter of fiscal 2018.

Interim Period, Costs Not Allocable [Line Items]

Quarterly Data

Q. Quarterly data (unaudited)


For the year ended July 31, 2019	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	352,309	$	573,377	$	479,625	$	279,081
Gross margin from propane and other gas liquids sales (a)		130,830		238,581		209,167		127,764
Net earnings (loss)	$	(48,814)	$	52,617	$	29,554	$	(62,874)


For the year ended July 31, 2018	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	454,655	$	755,156	$	515,810	$	347,521
Gross margin from propane and other gas liquids sales (a)		123,243		229,321		190,883		126,115
Gross margin from midstream operations (b)		12,635		10,209		8,077		(4,161)
Net earnings (loss) (c)	$	(39,699)	$	6,847	$	19,840	$	(209,134)


For the year ended July 31, 2017	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	379,542	$	579,250	$	538,109	$	433,376
Gross margin from propane and other gas liquids sales (a)		123,187		202,346		171,950		126,774
Gross margin from midstream operations (b)		13,402		9,763		7,909		6,190
Net earnings (loss)	$	(39,440)	$	42,600	$	15,395	$	(47,614)

(a)

Gross margin from “Propane and other gas liquids sales” represents “Revenues - propane and other gas liquids sales” less “Cost of sales – propane and other gas liquids sales.”

(b)

Gross margin from “Midstream operations” represents “Revenues - midstream operations” less “Cost of sales - midstream operations.”

(c)

Includes asset impairment charges of $10.0 million in the second quarter of fiscal 2018.

Income Taxes	12 Months Ended
Income Taxes	Jul. 31, 2019
Ferrellgas Partners Finance Corp. [Member]
Income Tax Disclosure [Line Items]
Income Taxes	Income taxes Income taxes have been computed separately as the Finance Corp. files its own income tax return. Deferred income taxes are provided as a result of temporary differences between financial and tax reporting using the asset/liability method. Deferred income taxes are recognized for the tax consequences of temporary differences between the financial statement carrying amounts and tax basis of existing assets and liabilities. Due to the inability of the Finance Corp. to utilize the deferred tax benefit of $6,430 associated with the net operating loss carryforward of $30,620 generated prior to fiscal 2019, which expire at various dates through July 31, 2037, a valuation allowance has been provided on the full amount of the deferred tax asset. The net operating loss carryforwards generated during and after fiscal 2019 are carried forward indefinitely. Accordingly, there is no net deferred tax benefit for fiscal 2019, 2018 or 2017, and there is no net deferred tax asset as of July 31, 2019 and 2018.
Ferrellgas Finance Corp. [Member]
Income Tax Disclosure [Line Items]
Income Taxes	Income taxes Income taxes have been computed separately as the Finance Corp. files its own income tax return. Deferred income taxes are provided as a result of temporary differences between financial and tax reporting using the asset/liability method. Deferred income taxes are recognized for the tax consequences of temporary differences between the financial statement carrying amounts and tax basis of existing assets and liabilities. Due to the inability of the Finance Corp. to utilize the deferred tax benefit of $16,163 associated with the net operating loss carryforward of $76,969 generated prior to fiscal 2019, which expire at various dates through July 31, 2037, a valuation allowance has been provided on the full amount of the deferred tax asset. The net operating loss carryforwards generated during and after fiscal 2019 are carried forward indefinitely. Accordingly, there is no net deferred tax benefit for fiscal 2019, 2018 or 2017, and there is no net deferred tax asset as of July 31, 2019 and 2018.

Guarantor financial information

12 Months Ended

Jul. 31, 2019

Condensed Financial Statements, Captions [Line Items]

Guarantor financial information

Schedule 1

FERRELLGAS PARTNERS, L.P.
PARENT ONLY
BALANCE SHEETS
(in thousands, except unit data)


	July 31,
	2019		2018
ASSETS

Cash and cash equivalents	$	8	$	3
Prepaid expenses and other current assets		57		23
Total assets	$	65	$	26

LIABILITIES AND PARTNERS’ DEFICIT

Current portion of long-term debt	$	354,727	$	—
Other current liabilities		3,873		3,925
Long-term debt		—		350,500
Investment in Ferrellgas, L.P.		772,698		673,386

Partners’ deficit
Common unitholders (97,152,665 units outstanding at 2019 and 2018)		(1,046,245)		(978,503)
General partner unitholder (989,926 units outstanding at 2019 and 2018)		(70,476)		(69,792)
Accumulated other comprehensive income (loss)		(14,512)		20,510
Total Ferrellgas Partners, L.P. partners’ deficit		(1,131,233)		(1,027,785)
Total liabilities and partners’ deficit	$	65	$	26

FERRELLGAS PARTNERS, L.P.

PARENT ONLY

STATEMENTS OF OPERATIONS

(in thousands)


	For the year ended July 31,
	2019		2018		2017
Equity in loss of Ferrellgas, L.P.	$	(29,219)	$	(219,902)	$	(28,765)
Operating, general and administrative expense		14		137		139

Operating loss		(29,233)		(220,039)		(28,904)

Interest expense		(34,984)		(34,521)		(25,297)
Income tax expense		30		21		6
Net loss	$	(64,247)	$	(254,581)	$	(54,207)

FERRELLGAS PARTNERS, L.P.

PARENT ONLY

STATEMENTS OF CASH FLOWS

(in thousands)


	For the year ended July 31,
	2019		2018		2017
Cash flows from operating activities:
Net loss attributable to Ferrellgas Partners, L.P.	$	(64,247)	$	(254,581)	$	(54,207)
Reconciliation of net loss to net cash used in operating activities:
Other		4,141		3,673		3,982
Equity in loss of Ferrellgas, L.P.		29,219		219,902		28,765
Net cash used in operating activities		(30,887)		(31,006)		(21,460)

Cash flows from investing activities:
Distributions received from Ferrellgas, L.P.		40,706		70,246		118,829
Cash contributed to Ferrellgas, L.P.		—		—		(166,148)
Net cash provided by (used in) investing activities		40,706		70,246		(47,319)

Cash flows from financing activities:
Distributions paid to common and general partner unitholders		(9,814)		(39,254)		(79,733)
Cash paid for financing costs		—		(42)		(3,653)
Proceeds from issuance of long-term debt		—		—		168,000
Repurchase of common units		—		—		(15,851)
Net cash provided by (used in) financing activities		(9,814)		(39,296)		68,763

Decrease in cash and cash equivalents		5		(56)		(16)
Cash and cash equivalents - beginning of year		3		59		75
Cash and cash equivalents - end of year	$	8	$	3	$	59

Condensed Financial Statements, Captions [Line Items]

Guarantor financial information

R. Guarantor financial information

The $500.0 million aggregate principal amount of registered 6.75% senior notes due 2023 co-issued by Ferrellgas, L.P. and Ferrellgas Finance Corp. are fully and unconditionally and jointly and severally guaranteed by all of Ferrellgas, L.P.’s 100% owned subsidiaries except: (i) Ferrellgas Finance Corp; (ii) certain special purposes subsidiaries formed for use in connection with our accounts receivable securitization; and (iii) foreign subsidiaries. Guarantees of these senior notes will be released under certain circumstances, including (i) in connection with any sale or other disposition of (a) all or substantially all of the assets of a guarantor or (b) all of the capital stock of such guarantor (including by way of merger or consolidation), in each case, to a person that is not Ferrellgas, L.P. or a restricted subsidiary of Ferrellgas, L.P., (ii) if Ferrellgas, L.P. designates any restricted subsidiary that is a guarantor as an unrestricted subsidiary, (iii) upon defeasance or discharge of the notes, (iv) upon the liquidation or dissolution of such guarantor, or (v) at such time as such guarantor ceases to guarantee any other indebtedness of either of the issuers and any other guarantor.

The guarantor financial information discloses in separate columns the financial position, results of operations and the cash flows of Ferrellgas, L.P. (Parent), Ferrellgas Finance Corp. (co-issuer), Ferrellgas L.P.’s guarantor subsidiaries on a combined basis, and Ferrellgas L.P.’s non-guarantor subsidiaries on a combined basis. The dates and the periods presented in the guarantor financial information are consistent with the periods presented in Ferrellgas, L.P.’s consolidated financial statements.

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEETS

(in thousands)


	As of July 31, 2019
	Ferrellgas, L.P.		Ferrellgas
	(Parent and		Finance Corp.		Guarantor		Non-Guarantor
	Co-Issuer)		(Co-Issuer)		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	11,045	$	1	$	—	$	—	$	—	$	11,046
Accounts and notes receivable, net		(3,912)		—		35		111,473		—		107,596
Intercompany receivables		(5,650)		—		—		—		5,650		—
Inventories		80,454		—		—		—		—		80,454
Assets held for sale		—		—		—		—		—		—
Prepaid expenses and other current assets		42,158		—		(1)		—		—		42,157
Total current assets		124,095		1		34		111,473		5,650		241,253

Property, plant and equipment, net		596,724		—		(1)		—		—		596,723
Goodwill, net		247,195		—		—		—		—		247,195
Intangible assets, net		108,557		—		—		—		—		108,557
Investments in consolidated subsidiaries		52,999		—		—		—		(52,999)		—
Other assets, net		65,447		—		2,875		783		—		69,105
Total assets	$	1,195,017	$	1	$	2,908	$	112,256	$	(47,349)	$	1,262,833

LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Current liabilities:
Accounts payable	$	33,252	$	—	$	—	$	112	$	—	$	33,364
Short-term borrowings		43,000		—		—		—		—		43,000
Collateralized note payable		—		—		—		62,000		—		62,000
Intercompany payables		—		—		(192)		(5,458)		5,650		—
Current portion of long-term debt		277,029		—		—		—		—		277,029
Other current liabilities		128,666		—		20		5,617		—		134,303
Total current liabilities		481,947		—		(172)		62,271		5,650		549,696

Long-term debt		1,457,004		—		—		—		—		1,457,004
Other liabilities		36,469		—		67		—		—		36,536
Contingencies and commitments

Partners' capital (deficit):
Partners' equity		(765,756)		1		3,013		49,985		(52,999)		(765,756)
Accumulated other comprehensive loss		(14,647)		—		—		—		—		(14,647)
Total partners' capital (deficit)		(780,403)		1		3,013		49,985		(52,999)		(780,403)
Total liabilities and partners' capital (deficit)	$	1,195,017	$	1	$	2,908	$	112,256	$	(47,349)	$	1,262,833

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEETS

(in thousands)


	As of July 31, 2018
	Ferrellgas, L.P.		Ferrellgas
	(Parent and		Finance Corp.		Guarantor		Non-Guarantor
	Co-Issuer)		(Co-Issuer)		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	119,133	$	1	$	174	$	—	$	—	$	119,308
Accounts and notes receivable, net		(3,420)		—		9,395		120,079		—		126,054
Intercompany receivables		15,660		—		—		—		(15,660)		—
Inventories		83,694		—		—		—		—		83,694
Prepaid expenses and other current assets		34,050		—		775		5		—		34,830
Total current assets		249,117		1		10,344		120,084		(15,660)		363,886

Property, plant and equipment, net		557,689		—		34		—		—		557,723
Goodwill, net		246,098		—		—		—		—		246,098
Intangible assets, net		120,951		—		—		—		—		120,951
Investments in consolidated subsidiaries		59,937		—		—		—		(59,937)		—
Other assets, net		63,411		—		9,961		1,216		—		74,588
Total assets	$	1,297,203	$	1	$	20,339	$	121,300	$	(75,597)	$	1,363,246

LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Current liabilities:
Accounts payable	$	45,171	$	—	$	1,547	$	102	$	—	$	46,820
Short-term borrowings		32,800		—		—		—		—		32,800
Collateralized note payable		—		—		—		58,000		—		58,000
Intercompany payables		—		—		(143)		15,803		(15,660)		—
Current portion of long-term debt		2,402		—		—		—		—		2,402
Other current liabilities		129,300		—		6,036		353		—		135,689
Total current liabilities		209,673		—		7,440		74,258		(15,660)		275,711

Long-term debt		1,728,137		—		—		—		—		1,728,137
Other liabilities		39,471		—		5		—		—		39,476
Contingencies and commitments

Partners' capital (deficit):
Partners' equity		(700,811)		1		12,894		47,042		(59,937)		(700,811)
Accumulated other comprehensive income		20,733		—		—		—		—		20,733
Total partners' capital (deficit)		(680,078)		1		12,894		47,042		(59,937)		(680,078)
Total liabilities and partners' capital (deficit)	$	1,297,203	$	1	$	20,339	$	121,300	$	(75,597)	$	1,363,246

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

(in thousands)


	For the year ended July 31, 2019
	Ferrellgas, L.P.		Ferrellgas
	(Parent and		Finance Corp.		Guarantor		Non-Guarantor
	Co-Issuer)		(Co-Issuer)		Subsidiaries		Subsidiaries		Eliminations		Consolidated

Revenues:
Propane and other gas liquids sales	$	1,608,858	$	—	$	—	$	—	$	—	$	1,608,858
Other		75,485		—		49		—		—		75,534
Total revenues		1,684,343		—		49		—		—		1,684,392

Costs and expenses:
Cost of sales - propane and other gas liquids sales		902,516		—		—		—		—		902,516
Cost of sales - other		11,292		—		114		—		—		11,406
Operating expense		469,652		—		37		3,589		(4,410)		468,868
Depreciation and amortization expense		78,400		—		—		446		—		78,846
General and administrative expense		59,974		6		—		—		—		59,980
Equipment lease expense		33,073		—		—		—		—		33,073
Non-cash employee stock ownership plan compensation charge		5,693		—		—		—		—		5,693
Loss on asset sales and disposals		8,289		—		2,679		—		—		10,968

Operating income (loss)		115,454		(6)		(2,781)		(4,035)		4,410		113,042

Interest expense		(132,929)		—		(38)		(9,668)		—		(142,635)
Other income (expense), net		428		—		(59)		4,410		(4,410)		369

Earnings (loss) before income taxes		(17,047)		(6)		(2,878)		(9,293)		—		(29,224)

Income tax expense		105		—		188		—		—		293
Equity in earnings (loss) of subsidiary		(12,365)		—		—		—		12,365		—

Net earnings (loss)		(29,517)		(6)		(3,066)		(9,293)		12,365		(29,517)

Other comprehensive loss		(35,380)		—		—		—		—		(35,380)

Comprehensive income (loss)	$	(64,897)	$	(6)	$	(3,066)	$	(9,293)	$	12,365	$	(64,897)

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

(in thousands)


	For the year ended July 31, 2018
	Ferrellgas, L.P.		Ferrellgas
	(Parent and		Finance Corp.		Guarantor		Non-Guarantor
	Co-Issuer)		(Co-Issuer)		Subsidiaries		Subsidiaries		Eliminations		Consolidated

Revenues:
Propane and other gas liquids sales	$	1,642,155	$	—	$	821	$	—	$	—	$	1,642,976
Midstream operations		—		—		282,319		—		—		282,319
Other		72,954		—		74,893		—		—		147,847
Total revenues		1,715,109		—		358,033		—		—		2,073,142

Costs and expenses:
Cost of sales - propane and other gas liquids sales		972,467		—		947		—		—		973,414
Cost of sales - midstream operations		—		—		255,559		—		—		255,559
Cost of sales - other		10,111		—		58,543		—		—		68,654
Operating expense		436,962		—		37,617		4,755		(7,586)		471,748
Depreciation and amortization expense		75,163		—		26,317		315		—		101,795
General and administrative expense		48,337		5		5,922		—		—		54,264
Equipment lease expense		27,939		—		333		—		—		28,272
Non-cash employee stock ownership plan compensation charge		13,859		—		—		—		—		13,859
Asset impairments		—		—		10,005		—		—		10,005
Loss on asset sales and disposals		8,978		—		178,421		—		—		187,399

Operating income (loss)		121,293		(5)		(215,631)		(5,070)		7,586		(91,827)

Interest expense		(86,646)		—		(43,247)		(4,053)		—		(133,946)
Other income (expense), net		(234)		—		1,162		7,586		(7,586)		928

Earnings (loss) before income taxes		34,413		(5)		(257,716)		(1,537)		—		(224,845)

Income tax expense		222		—		(2,921)		—		—		(2,699)
Equity in earnings (loss) of subsidiary		(256,337)		—		—		—		256,337		—

Net earnings (loss)		(222,146)		(5)		(254,795)		(1,537)		256,337		(222,146)

Other comprehensive income		5,969		—		—		—		—		5,969

Comprehensive income (loss)	$	(216,177)	$	(5)	$	(254,795)	$	(1,537)	$	256,337	$	(216,177)

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

(in thousands)


	For the year ended July 31, 2017
	Ferrellgas, L.P.		Ferrellgas
	(Parent and		Finance Corp.		Guarantor		Non-Guarantor
	Co-Issuer)		(Co-Issuer)		Subsidiaries		Subsidiaries		Eliminations		Consolidated

Revenues:
Propane and other gas liquids sales	$	1,318,412	$	—	$	—	$	—	$	—	$	1,318,412
Midstream operations		—		—		466,703		—		—		466,703
Other		69,962		—		75,200		—		—		145,162
Total revenues		1,388,374		—		541,903		—		—		1,930,277

Costs and expenses:
Cost of sales - propane and other gas liquids sales		694,155		—		—		—		—		694,155
Cost of sales - midstream operations		—		—		429,439		—		—		429,439
Cost of sales - other		8,473		—		58,794		—		—		67,267
Operating expense		398,584		—		38,188		95		(4,455)		432,412
Depreciation and amortization expense		72,919		—		30,183		249		—		103,351
General and administrative expense		44,810		5		4,663		—		—		49,478
Equipment lease expense		28,560		—		564		—		—		29,124
Non-cash employee stock ownership plan compensation charge		15,088		—		—		—		—		15,088
Asset impairments		—		—		—		—		—		—
Loss on asset sales and disposals		9,198		—		5,259		—		—		14,457

Operating income (loss)		116,587		(5)		(25,187)		(344)		4,455		95,506

Interest expense		(80,866)		—		(43,839)		(2,480)		(3)		(127,188)
Other income (expense), net		850		—		624		4,452		(4,452)		1,474

Earnings (loss) before income taxes		36,571		(5)		(68,402)		1,628		—		(30,208)

Income tax expense (benefit)		217		—		(1,366)		—		—		(1,149)
Equity in earnings (loss) of subsidiaries		(65,413)		—		—		—		65,413		—

Net earnings (loss)		(29,059)		(5)		(67,036)		1,628		65,413		(29,059)

Other comprehensive loss		25,324		—		—		—		—		25,324

Comprehensive income (loss)	$	(3,735)	$	(5)	$	(67,036)	$	1,628	$	65,413	$	(3,735)

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(in thousands)


	For the year ended July 31, 2019
	Ferrellgas, L.P.		Ferrellgas
	(Parent and		Finance Corp.		Guarantor		Non-Guarantor
	Co-Issuer)		(Co-Issuer)		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	25,796	$	(6)	$	24,889	$	(717)	$	(4,000)	$	45,962

Cash flows from investing activities:
Business acquisitions, net of cash acquired		(13,551)		—		—		—		—		(13,551)
Capital expenditures		(108,822)		—		—		—		—		(108,822)
Proceeds from sale of assets		5,699		—		—		—		—		5,699
Cash collected for purchase of interest in accounts receivable		—		—		—		1,258,050		(1,258,050)		—
Cash remitted to Ferrellgas, L.P. for accounts receivable		—		—		—		(1,262,050)		1,262,050		—
Intercompany loan to affiliate		24,328		—		—		—		(24,328)		—
Cash payments to construct assets in connection with future lease transactions		(9,934)										(9,934)
Cash receipts in connection with leased vehicles		862										862
Other		1,419		—		—		—		—		1,419
Net cash used in investing activities		(99,999)		—		—		(4,000)		(20,327)		(124,327)

Cash flows from financing activities:
Distributions		(41,121)		—		—		—		—		(41,121)
Proceeds from increase in long-term debt		—		—		—		—		—		—
Reductions in long-term debt		(2,428)		—		—		—		—		(2,428)
Net additions to short-term borrowings		10,200		—		—		—		—		10,200
Net additions to collateralized short-term borrowings		—		—		—		4,000		—		4,000
Net changes in advances with consolidated entities		—		6		(25,063)		729		24,328		(0)
Cash paid for financing costs		(536)		—		—		(12)		—		(548)
Net cash provided by (used in) financing activities		(33,885)		6		(25,063)		4,717		24,328		(29,897)

Net change in cash and cash equivalents		(108,088)		—		(174)		(0)		0		(108,262)
Cash and cash equivalents - beginning of year		119,133		1		174		—		—		119,308
Cash and cash equivalents - end of year	$	11,045	$	1	$	—	$	(0)	$	0	$	11,046

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(in thousands)


	For the year ended July 31, 2018
	Ferrellgas, L.P.		Ferrellgas
	(Parent and		Finance Corp.		Guarantor		Non-Guarantor
	Co-Issuer)		(Co-Issuer)		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	139,294	$	(5)	$	(48,708)	$	3,573	$	11,000	$	105,154

Cash flows from investing activities:
Business acquisitions, net of cash acquired		(18,141)		—		—		—		—		(18,141)
Capital expenditures		(81,114)		—		(3,805)		—		—		(84,919)
Proceeds from sale of assets		7,327		—		145,260		—		—		152,587
Cash collected for purchase of interest in accounts receivable		—		—		—		1,226,211		(1,226,211)		—
Cash remitted to Ferrellgas, L.P. for accounts receivable		—		—		—		(1,215,211)		1,215,211		—
Net changes in advances with consolidated entities		96,514		—		—		—		(96,514)		—
Net cash provided by (used in) investing activities		4,586		—		141,455		11,000		(107,514)		49,527

Cash flows from financing activities:
Distributions		(70,962)		—		—		—		—		(70,962)
Proceeds from increase in long-term debt		323,680		—		—		—		—		323,680
Payments on long-term debt		(212,920)		—		—		—		—		(212,920)
Net reductions in short-term borrowings		(51,379)		—		—		—		—		(51,379)
Net additions to collateralized short-term borrowings		—		—		—		(11,000)		—		(11,000)
Net changes in advances with parent		—		5		(92,946)		(3,573)		96,514		—
Cash paid for financing costs		(18,493)		—		—		—		—		(18,493)
Net cash provided by (used in) financing activities		(30,074)		5		(92,946)		(14,573)		96,514		(41,074)

Net change in cash and cash equivalents		113,806		—		(199)		—		—		113,607
Cash and cash equivalents - beginning of year		5,327		1		373		—		—		5,701
Cash and cash equivalents - end of year	$	119,133	$	1	$	174	$	—	$	—	$	119,308

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(in thousands)


	For the year ended July 31, 2017
	Ferrellgas, L.P.		Ferrellgas
	(Parent and		Finance Corp.		Guarantor		Non-Guarantor
	Co-Issuer)		(Co-Issuer)		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	185,640	$	(5)	$	(36,297)	$	4,410	$	(5,000)	$	148,748

Cash flows from investing activities:
Business acquisitions, net of cash acquired		(3,539)		—		—		—		—		(3,539)
Capital expenditures		(49,107)		—		(1,365)		—		—		(50,472)
Proceeds from sale of assets, dispositions and other		8,510		—		—		—		—		8,510
Cash collected for purchase of interest in accounts receivable		—		—		—		1,011,244		(1,011,244)		—
Cash remitted to Ferrellgas, L.P for accounts receivable		—		—		—		(1,016,244)		1,016,244		—
Net changes in advances with consolidated entities		(33,573)		—		—		360		33,213		—
Other		(37)		—		—		—		—		(37)
Net cash provided by (used in) investing activities		(77,746)		—		(1,365)		(4,640)		38,213		(45,538)

Cash flows from financing activities:
Distributions		(119,879)		—		—		—		—		(119,879)
Contributions		167,843		—		—		—		—		167,843
Proceeds from issuance of long-term debt		62,864		—		—		—		—		62,864
Payments on long-term debt		(174,292)		—		—		—		—		(174,292)
Net additions to short-term borrowings		(41,510)		—		—		—		—		(41,510)
Net reductions in collateralized short-term borrowings		—		—		—		5,000		—		5,000
Net changes in advances with parent		—		5		37,618		(4,410)		(33,213)		—
Cash paid for financing costs		(2,065)		—		—		(360)		—		(2,425)
Net cash provided by (used in) financing activities		(107,039)		5		37,618		230		(33,213)		(102,399)

Effect of exchange rate changes on cash		—		—		—		—		—		—

Increase (decrease) in cash and cash equivalents		855		—		(44)		—		—		811
Cash and cash equivalents - beginning of year		4,472		1		417		—		—		4,890
Cash and cash equivalents - end of year	$	5,327	$	1	$	373	$	—	$	—	$	5,701

Subsequent Events	12 Months Ended
Subsequent Events	Jul. 31, 2019
Subsequent Event [Line Items]
Subsequent Events	S. Subsequent events Ferrellgas has evaluated events and transactions occurring after the balance sheet date through the date Ferrellgas’ consolidated financial statements were issued and concluded that there were no events or transactions occurring during this period that required recognition or disclosure in its financial statements.
Ferrellgas Partners Finance Corp. [Member]
Subsequent Event [Line Items]
Subsequent Events	Subsequent events The Finance Corp. has evaluated events and transactions occurring after the balance sheet date through the date the Finance Corp.’s consolidated financial statements were issued, and concluded that there were no events or transactions occurring during this period that required recognition or disclosure in its financial statements.
Ferrellgas, L.P. [Member]
Subsequent Event [Line Items]
Subsequent Events	S. Subsequent events Ferrellgas, L.P. has evaluated events and transactions occurring after the balance sheet date through the date Ferrellgas, L.P.’s consolidated financial statements were issued and concluded that there were no events or transactions occurring during this period that required recognition or disclosure in its financial statements.
Ferrellgas Finance Corp. [Member]
Subsequent Event [Line Items]
Subsequent Events	Subsequent events The Finance Corp. has evaluated events and transactions occurring after the balance sheet date through the date the Finance Corp.’s consolidated financial statements were issued, and concluded that there were no events or transactions occurring during this period that required recognition or disclosure in its financial statements.

Schedule I Parent Only Balance Sheets, Statements Of Earnings And Cash Flows

12 Months Ended

Jul. 31, 2019

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Guarantor financial information

Schedule 1

FERRELLGAS PARTNERS, L.P.
PARENT ONLY
BALANCE SHEETS
(in thousands, except unit data)


	July 31,
	2019		2018
ASSETS

Cash and cash equivalents	$	8	$	3
Prepaid expenses and other current assets		57		23
Total assets	$	65	$	26

LIABILITIES AND PARTNERS’ DEFICIT

Current portion of long-term debt	$	354,727	$	—
Other current liabilities		3,873		3,925
Long-term debt		—		350,500
Investment in Ferrellgas, L.P.		772,698		673,386

Partners’ deficit
Common unitholders (97,152,665 units outstanding at 2019 and 2018)		(1,046,245)		(978,503)
General partner unitholder (989,926 units outstanding at 2019 and 2018)		(70,476)		(69,792)
Accumulated other comprehensive income (loss)		(14,512)		20,510
Total Ferrellgas Partners, L.P. partners’ deficit		(1,131,233)		(1,027,785)
Total liabilities and partners’ deficit	$	65	$	26

FERRELLGAS PARTNERS, L.P.

PARENT ONLY

STATEMENTS OF OPERATIONS

(in thousands)


	For the year ended July 31,
	2019		2018		2017
Equity in loss of Ferrellgas, L.P.	$	(29,219)	$	(219,902)	$	(28,765)
Operating, general and administrative expense		14		137		139

Operating loss		(29,233)		(220,039)		(28,904)

Interest expense		(34,984)		(34,521)		(25,297)
Income tax expense		30		21		6
Net loss	$	(64,247)	$	(254,581)	$	(54,207)

FERRELLGAS PARTNERS, L.P.

PARENT ONLY

STATEMENTS OF CASH FLOWS

(in thousands)


	For the year ended July 31,
	2019		2018		2017
Cash flows from operating activities:
Net loss attributable to Ferrellgas Partners, L.P.	$	(64,247)	$	(254,581)	$	(54,207)
Reconciliation of net loss to net cash used in operating activities:
Other		4,141		3,673		3,982
Equity in loss of Ferrellgas, L.P.		29,219		219,902		28,765
Net cash used in operating activities		(30,887)		(31,006)		(21,460)

Cash flows from investing activities:
Distributions received from Ferrellgas, L.P.		40,706		70,246		118,829
Cash contributed to Ferrellgas, L.P.		—		—		(166,148)
Net cash provided by (used in) investing activities		40,706		70,246		(47,319)

Cash flows from financing activities:
Distributions paid to common and general partner unitholders		(9,814)		(39,254)		(79,733)
Cash paid for financing costs		—		(42)		(3,653)
Proceeds from issuance of long-term debt		—		—		168,000
Repurchase of common units		—		—		(15,851)
Net cash provided by (used in) financing activities		(9,814)		(39,296)		68,763

Decrease in cash and cash equivalents		5		(56)		(16)
Cash and cash equivalents - beginning of year		3		59		75
Cash and cash equivalents - end of year	$	8	$	3	$	59

Schedule II Valuation And Qualifying Accounts

12 Months Ended

Jul. 31, 2019

Valuation and Qualifying Accounts Disclosure [Line Items]

Schedule II Valuation And Qualifying Accounts

Schedule II

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES

VALUATION AND QUALIFYING ACCOUNTS

(in thousands)


	Balance at		Charged to					Balance
	beginning		cost and					at end
Description	of period		expenses		Other			of period
Year ended July 31, 2019
Allowance for doubtful accounts	$	2,455	$	1,525	$	(1,517)	(1)	$	2,463
Year ended July 31, 2018
Allowance for doubtful accounts	$	1,976	$	1,778	$	(1,299)	(1)	$	2,455
Year ended July 31, 2017
Allowance for doubtful accounts	$	5,526	$	7	$	(3,557)	(1)	$	1,976

Uncollectible accounts written off, net of recoveries.

Valuation and Qualifying Accounts Disclosure [Line Items]

Schedule II Valuation And Qualifying Accounts

Schedule II

FERRELLGAS, L.P. AND SUBSIDIARIES

VALUATION AND QUALIFYING ACCOUNTS

(in thousands)


	Balance at		Charged to					Balance
	beginning		cost and					at end
Description	of period		expenses		Other			of period
Year ended July 31, 2019
Allowance for doubtful accounts	$	2,455	$	1,525	$	(1,517)	(1)	$	2,463
Year ended July 31, 2018
Allowance for doubtful accounts	$	1,976	$	1,778	$	(1,299)	(1)	$	2,455
Year ended July 31, 2017
Allowance for doubtful accounts	$	5,526	$	7	$	(3,557)	(1)	$	1,976

Uncollectible accounts written off, net of recoveries.

Summary Of Significant Accounting Policies (Policy)

12 Months Ended

Jul. 31, 2019

Principles of consolidation

Accounting estimates

Principles of consolidation: The accompanying consolidated financial statements present the consolidated financial position, results of operations and cash flows of Ferrellgas Partners, its wholly-owned subsidiary, Ferrellgas Partners Finance Corp., and the operating partnership, its majority-owned subsidiary, after elimination of all intercompany accounts and transactions. We have determined that the operating partnership is a variable interest entity for whom Ferrellgas Partners has no ability through voting rights or similar rights to make decisions and thus does not have the power to direct the activities of the operating partnership that most significantly impact economic performance. However, we have determined that the accounts of Ferrellgas Partners’ majority-owned subsidiary should be included because Ferrellgas Partners is most closely associated with the operations of the operating partnership due to the fact that Ferrellgas Partners has the obligation to absorb the losses of and the right to receive benefits from the operating partnership that are significant to the operating partnership and substantially all the assets and liabilities of Ferrellgas Partners consist of the operating partnership. The operating partnership includes the accounts of its wholly-owned subsidiaries. The general partner’s approximate 1% general partner interest in the operating partnership is accounted for as a noncontrolling interest. The wholly-owned consolidated subsidiary of the operating partnership, Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), is a special purpose entity that has agreements with the operating partnership to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Certain prior-year amounts have been reclassified to conform to the current-year presentation.

Fair value measurements

Fair value measurements: Ferrellgas measures certain of its assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants – in either the principal market or the most advantageous market. The principal market is the market with the greatest level of activity and volume for the asset or liability.

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

Accounts receivable

Accounts receivable securitization

Accounts receivable securitization: Through its wholly-owned and consolidated subsidiary Ferrellgas Receivables, Ferrellgas has agreements to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Inventories

Inventories: Inventories are stated at the lower of cost or net realizable value using weighted average cost and actual cost methods.

Property, plant and equipment

Property, plant and equipment: Property, plant and equipment are stated at cost less accumulated depreciation. Expenditures for maintenance and routine repairs are expensed as incurred. Ferrellgas capitalizes computer software, equipment replacement and betterment expenditures that upgrade, replace or completely rebuild major mechanical components and extend the original useful life of the equipment. Depreciation is calculated using the straight-line method based on the estimated useful lives of the assets ranging from two to 30 years. Ferrellgas, using its best estimates based on reasonable and supportable assumptions and projections, tests long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of its assets or asset groups might not be recoverable. The recoverability tests for property, plant and equipment are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas management’s plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

Goodwill

Goodwill: Ferrellgas records goodwill as the excess of the cost of acquisitions over the fair value of the related net assets at the date of acquisition. Ferrellgas tests goodwill for impairment annually during the second quarter or more frequently if events or changes in circumstances indicate that it is more likely than not the fair value of a reporting unit is less than the carrying value. Ferrellgas has determined that it has two reporting units for goodwill impairment testing purposes. As of July 31, 2019, one of these reporting units contains goodwill that is subject to at least an annual assessment for impairment by applying a fair-value-based test. Under this test, the carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units as of the date of the evaluation on a specific identification basis. To the extent a reporting unit’s carrying value exceeds its fair value, the reporting unit’s goodwill is impaired. The amount of impairment would be equal to the lesser of the excess of reporting unit carrying value over its fair value and the reporting unit’s recorded amount of goodwill. Ferrellgas completed its most recent annual goodwill impairment test on January 31, 2019 and did not incur an impairment loss. For fiscal 2018, the test was performed on January 31, 2018, and an impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment was recorded.

Intangible assets

Intangible assets: Intangible assets with finite useful lives, consisting primarily of customer related assets and non-compete agreements, permits, favorable lease arrangements and patented technology are stated at cost, net of accumulated amortization calculated using the straight-line method over periods ranging from two to 15 years. When necessary, intangible assets’ useful lives are revised and the impact on amortization reflected on a prospective basis. Trade names and trademarks have indefinite lives, are not amortized, and are stated at cost. Ferrellgas tests finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of these assets or asset groups might not be recoverable. Ferrellgas tests indefinite-lived intangible assets for impairment annually on January 31 or more frequently if circumstances dictate. The recoverability tests for definite-lived intangible assets are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas management’s plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

Derivative instruments and hedging activities

Derivative instruments and hedging activities:

Commodity and Transportation Fuel Price Risk.

Interest Rate Risk.

Revenue recognition

Revenue recognition: Revenues from Ferrellgas’ propane operations and related equipment sales segment are recognized at the time product is delivered with payments generally due 30 days after receipt. Amounts are considered past due after 30 days. Ferrellgas determines accounts receivable allowances based on management’s assessment of the creditworthiness of the customers and other collection actions. Ferrellgas offers “even pay” billing programs that can create customer deposits or advances. Revenue is recognized from these customer deposits or advances to customers at the time product is delivered. Other revenues, which include revenue from the sale of propane appliances and equipment is recognized at the time of delivery or installation. Ferrellgas recognizes shipping and handling revenues and expenses for sales of propane, appliances and equipment at the time of delivery or installation. Shipping and handling revenues are included in the price of propane charged to customers, and are classified as revenue. Revenues from annually billed, non-refundable propane tank rentals are recognized in “Revenues: other” on a straight-line basis over one year.

Shipping and handling expenses and cost of sales

Shipping and handling expenses: Shipping and handling expenses related to delivery personnel, vehicle repair and maintenance and general liability expenses are classified within “Operating expense” in the consolidated statements of operations. Depreciation expenses on delivery vehicles Ferrellgas owns are classified within “Depreciation and amortization expense.” Delivery vehicles and distribution technology leased by Ferrellgas are classified within “Equipment lease expense.”

See Note E – Supplemental financial statement information – for the financial statement presentation of shipping and handling expenses.

Operating expenses

Operating expense: “Operating expense” primarily includes the personnel, vehicle, delivery, handling, plant, office, selling, marketing, credit and collections and other expenses.

General and administrative expenses

Stock-based and unit option plans

(16) Stock-based plans:

Ferrell Companies, Inc. Incentive Compensation Plans (“ICPs”)

Income taxes

Income taxes: Ferrellgas Partners is a publicly-traded master limited partnership with one subsidiary that is a taxable corporation. The operating partnership is a limited partnership with three subsidiaries that are taxable corporations. Partnerships are generally not subject to federal income tax, although publicly-traded partnerships are treated as corporations for federal income tax purposes and therefore subject to Federal income tax unless a qualifying income test is satisfied. If this qualifying income test is satisfied, the publicly-traded partnership will be treated as a partnership for Federal income tax purposes. Based on Ferrellgas’ calculations, Ferrellgas Partners satisfies the qualifying income test. As a result, except for the taxable corporations, Ferrellgas Partners’ earnings or losses for Federal income tax purposes are included in the tax returns of the individual partners, Ferrellgas Partners’ unitholders. Accordingly, the accompanying consolidated financial statements of Ferrellgas Partners reflect federal income taxes related to the above mentioned taxable corporations and certain states that allow for income taxation of partnerships. Net earnings for financial statement purposes may differ significantly from taxable income reportable to Ferrellgas Partners unitholders as a result of differences between the tax basis and financial reporting basis of assets and liabilities, the taxable income allocation requirements under Ferrellgas Partners’ partnership agreement and differences between Ferrellgas Partners’ financial reporting fiscal year end and its calendar tax year end.

Income tax expense (benefit) consisted of the following:


	For the year ended July 31,
	2019		2018		2017
Current expense (benefit)	$	180	$	1,140	$	(1,154)
Deferred expense (benefit)		143		(3,818)		11
Income tax expense (benefit)	$	323	$	(2,678)	$	(1,143)

Deferred taxes consisted of the following:


	July 31,
	2019		2018
Deferred tax assets (included in Other assets, net)	$	631	$	715
Deferred tax liabilities (included in Other liabilities)		(76)		(16)
Net deferred tax asset	$	555	$	699

Sales taxes

Sales taxes: Ferrellgas accounts for the collection and remittance of sales tax on a net tax basis. As a result, these amounts are not reflected in the consolidated statements of operations.

Net earnings (loss) per common unitholders' interest

Net loss per common unitholders’ interest: Net loss per common unitholders’ interest is computed by dividing “Net loss attributable to Ferrellgas Partners, L.P.,” after deducting the general partner’s approximate 1% interest, by the weighted average number of outstanding common units and the dilutive effect, if any, of outstanding unit options. See Note P – Net loss per common unitholders’ interest – for further discussion about these calculations.

Loss contingencies

Loss contingencies: In the normal course of business, Ferrellgas is involved in various claims and legal proceedings. Ferrellgas records a liability for such matters when it is probable that a loss has been incurred and the amounts can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. Legal costs associated with loss contingencies are expensed as incurred.

New accounting standards

FASB Accounting Standard Update No. 2014‑09

FASB Accounting Standard Update No. 2016‑02

FASB Accounting Standard Update No. 2016‑13

FASB Accounting Standard Update No. 2017‑12

FASB Accounting Standard Update No. 2018‑15

Principles of consolidation

Accounting estimates

(1)

Principles of consolidation: The accompanying consolidated financial statements present the consolidated financial position, results of operations and cash flows of Ferrellgas, L.P. and its subsidiaries after elimination of all intercompany accounts and transactions. Ferrellgas, L.P. consolidates the following wholly-owned entities: Bridger Logistics, LLC, Sable Environmental, LLC, Sable SWD 2, LLC, Blue Rhino Global Sourcing, Inc., Blue Rhino Canada, Inc., Ferrellgas Real Estate, Inc., Ferrellgas Finance Corp. and Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), a special purpose entity that has agreements with Ferrellgas, L.P. to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Certain prior-year amounts have been reclassified to conform to the current-year presentation.

Fair value measurements

(1)

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

Accounts receivable

(1)

Accounts receivable securitization

Inventories

Inventories: Inventories are stated at the lower of cost or net realizable value using weighted average cost and actual cost methods.

Property, plant and equipment

Goodwill

(1)

Intangible assets

Derivative instruments and hedging activities

(1)

Derivative instruments and hedging activities:

Commodity and Transportation Fuel Price Risk.

Interest Rate Risk.

Revenue recognition

(1)

Shipping and handling expenses and cost of sales

(1)

See Note E – Supplemental financial statement information – for the financial statement presentation of shipping and handling expenses.

(2)

Operating expenses

Operating expenses: “Operating expense” primarily includes the personnel, vehicle, delivery, handling, plant, office, selling, marketing, credit and collections and other expenses.

General and administrative expenses

Stock-based and unit option plans

(1)

Stock-based plans:

Ferrell Companies, Inc. Incentive Compensation Plans (“ICPs”)

Income taxes

(1)

Income tax expense (benefit) consisted of the following:


	For the year ended July 31,
	2019		2018		2017
Current expense (benefit)	$	150	$	1,119	$	(1,160)
Deferred expense (benefit)		143		(3,818)		11
Income tax expense (benefit)	$	293	$	(2,699)	$	(1,149)

Deferred taxes consisted of the following:


	July 31,
	2019		2018
Deferred tax assets (included in Other assets, net)	$	631	$	715
Deferred tax liabilities (included in Other liabilities)		(76)		(16)
Net deferred tax asset	$	555	$	699

Sales taxes

Sales taxes: Ferrellgas, L.P. accounts for the collection and remittance of sales tax on a net tax basis. As a result, these amounts are not reflected in the consolidated statements of operations.

Loss contingencies

New accounting standards

FASB Accounting Standard Update No. 2014‑09

FASB Accounting Standard Update No. 2016‑02

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new standard requires lessees to apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. An entity may elect the transition relief option in ASU 2018-11, “Leases: Targeted Improvements” which, among other things, provides entities with an option to recognize the cumulative-effect adjustment from the modified retrospective application to the opening balance of retained earnings in the period of adoption and consequently, continue to report comparative periods in compliance with the prior guidance (ASC 840). Ferrellgas, L.P. expects to elect this additional transition method. Additionally, Ferrellgas, L.P. currently expects to elect the short-term lease recognition exemption for all leases that qualify, meaning we would not recognize right-of-use assets or lease liabilities for those leases. We also currently expect to elect the practical expedient to not separate lease and non-lease components for our most significant leasing activity, which includes vehicle and real estate leases.

FASB Accounting Standard Update No. 2016‑13

FASB Accounting Standard Update No. 2017‑12

In August 2017, the FASB issued ASU 2017‑12, Financial Instruments - Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities , which is intended to improve the financial reporting for hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. Ferrellgas, L.P. believes that the adoption of this standard, which will be effective for Ferrellgas, L.P. August 1, 2019, will result in additional disclosure related to the impact on the consolidated statement of operations for derivatives designated as hedging instruments. Ferrellgas, L.P. has not finalized the effects of these expected changes from the new standard.

FASB Accounting Standard Update No. 2018-15

Summary Of Significant Accounting Policies (Tables)

12 Months Ended

Jul. 31, 2019

Significant Accounting Policies [Line Items]

Summary Of Income Tax Expense


	For the year ended July 31,
	2019		2018		2017
Current expense (benefit)	$	180	$	1,140	$	(1,154)
Deferred expense (benefit)		143		(3,818)		11
Income tax expense (benefit)	$	323	$	(2,678)	$	(1,143)

Deferred Tax Assets And Liabilities


	July 31,
	2019		2018
Deferred tax assets (included in Other assets, net)	$	631	$	715
Deferred tax liabilities (included in Other liabilities)		(76)		(16)
Net deferred tax asset	$	555	$	699

Significant Accounting Policies [Line Items]

Summary Of Income Tax Expense


	For the year ended July 31,
	2019		2018		2017
Current expense (benefit)	$	150	$	1,119	$	(1,160)
Deferred expense (benefit)		143		(3,818)		11
Income tax expense (benefit)	$	293	$	(2,699)	$	(1,149)

Deferred Tax Assets And Liabilities


	July 31,
	2019		2018
Deferred tax assets (included in Other assets, net)	$	631	$	715
Deferred tax liabilities (included in Other liabilities)		(76)		(16)
Net deferred tax asset	$	555	$	699

Acquisitions, dispositions and other significant transactions (Tables)

12 Months Ended

Jul. 31, 2019

Schedule of Loss on Assets Sales and Disposals


	For the year ended July 31,
	2019		2018		2017
Loss on sale of:
Propane-related accessories reporting unit	$	—	$	15,194	$	—
Midstream trucking, water disposal & terminal assets		2,679		120,240		—
Midstream railcars		—		36,762		—
Bridger Energy		—		4,002		—
Other		8,289		11,201		14,457
Loss on asset sales and disposals	$	10,968	$	187,399	$	14,457

Schedule of Loss on Assets Sales and Disposals


	For the year ended July 31,
	2019		2018		2017
Loss on sale of:
Propane-related accessories reporting unit	$	—	$	15,194	$	—
Midstream trucking, water disposal & terminal assets		2,679		120,240		—
Midstream railcars		—		36,762		—
Bridger Energy		—		4,002		—
Other		8,289		11,201		14,457
Loss on asset sales and disposals	$	10,968	$	187,399	$	14,457

Propane and related equipment sales

Schedule Of Funding Of Acquisitions


	For the year ended July 31,
	2019		2018		2017
Cash payments, net of cash acquired	$	13,551	$	18,141	$	3,539
Issuance of liabilities and other costs and considerations		1,650		2,426		856
Aggregate fair value of transactions	$	15,201	$	20,567	$	4,395

Aggregate Fair Value Of Transaction


	For the year ended July 31,
	2019		2018		2017
Working capital	$	31	$	758	$	139
Customer tanks, buildings, land and other		11,560		10,022		1,220
Goodwill		1,410		—		—
Customer lists		1,272		7,758		2,648
Non-compete agreements		928		2,029		388
Aggregate fair value of net assets acquired	$	15,201	$	20,567	$	4,395

Schedule Of Funding Of Acquisitions


	For the year ended July 31,
	2019		2018		2017
Cash payments, net of cash acquired	$	13,551	$	18,141	$	3,539
Issuance of liabilities and other costs and considerations		1,650		2,426		856
Aggregate fair value of transactions	$	15,201	$	20,567	$	4,395

Aggregate Fair Value Of Transaction


	For the year ended July 31,
	2019		2018		2017
Working capital		31		758		139
Customer tanks, buildings, land and other		11,560		10,022		1,220
Goodwill		1,410		—		—
Customer lists		1,272		7,758		2,648
Non-compete agreements		928		2,029		388
Aggregate fair value of net assets acquired	$	15,201	$	20,567	$	4,395

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

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Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
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+ Details

Supplemental Financial Statement Information (Tables)

12 Months Ended

Jul. 31, 2019

Supplemental Financial Statement Information [Line Items]

Schedule Of Inventories


	July 31, 2019		July 31, 2018
Propane gas and related products	$	66,001	$	71,180
Appliances, parts and supplies, and other		14,453		12,514
Inventories	$	80,454	$	83,694

Property, Plant And Equipment


	Estimated useful lives	July 31, 2019		July 31, 2018
Land	Indefinite	$	35,165	$	33,719
Land improvements	2-20		14,149		13,361
Buildings and improvements	20		86,444		71,612
Vehicles, including transport trailers	8-20		111,283		85,893
Bulk equipment and district facilities	5-30		109,751		103,627
Tanks, cylinders and customer equipment	2-30		779,827		769,165
Computer and office equipment	2-5		111,838		109,346
Construction in progress	n/a		7,061		14,394
			1,255,518		1,201,117
Less: accumulated depreciation			658,795		643,394
Property, plant and equipment, net		$	596,723	$	557,723

Prepaid Expenses and Other Current Assets


	July 31, 2019		July 31, 2018
Broker margin deposit assets	$	25,028	$	2,851
Other		17,247		32,011
Prepaid expenses and other current assets	$	42,275	$	34,862

Other Assets


	July 31, 2019		July 31, 2018
Notes receivable, less current portion	$	16,216	$	27,491
Other		52,889		47,097
Other assets, net	$	69,105	$	74,588

Other Current Liabilities


	July 31, 2019		July 31, 2018
Accrued interest	$	20,484	$	22,222
Customer deposits and advances		24,686		22,829
Accrued payroll		17,356		16,060
Accrued insurance		18,524		15,100
Price risk management liabilities		14,198		1,832
Other		42,989		61,580
Other current liabilities	$	138,237	$	139,623

Shipping And Handling Expenses


	For the year ended July 31,
	2019		2018		2017
Operating expense	$	215,780	$	195,646	$	175,164
Depreciation and amortization expense		6,375		4,947		3,909
Equipment lease expense		30,759		25,765		26,299
	$	252,914	$	226,358	$	205,372

Cash Flow Supplemental Disclosures


	For the year ended July 31,
	2019		2018		2017
Cash paid (refunded) for:
Interest	$	166,897	$	159,271	$	143,441
Income taxes	$	141	$	(291)	$	310
Non-cash investing and financing activities:
Liabilities incurred in connection with acquisitions	$	1,650	$	1,993	$	139
Change in accruals for property, plant and equipment additions	$	1,132	$	264	$	164

Supplemental Financial Statement Information [Line Items]

Schedule Of Inventories


	July 31, 2019		July 31, 2018
Propane gas and related products	$	66,001	$	71,180
Appliances, parts and supplies, and other		14,453		12,514
Inventories	$	80,454	$	83,694

Property, Plant And Equipment


	Estimated useful lives	July 31, 2019		July 31, 2018
Land	Indefinite	$	35,165	$	33,719
Land improvements	2-20		14,149		13,361
Buildings and improvements	20		86,444		71,612
Vehicles, including transport trailers	8-20		111,283		85,893
Bulk equipment and district facilities	5-30		109,751		103,627
Tanks, cylinders and customer equipment	2-30		779,827		769,165
Computer and office equipment	2-5		111,838		109,346
Construction in progress	n/a		7,061		14,394
			1,255,518		1,201,117
Less: accumulated depreciation			658,795		643,394
Property, plant and equipment, net		$	596,723	$	557,723

Prepaid Expenses and Other Current Assets


	July 31, 2019		July 31, 2018
Broker margin deposit assets	$	25,028	$	2,851
Other		17,129		31,979
Prepaid expenses and other current assets	$	42,157	$	34,830

Other Assets


	July 31, 2019		July 31, 2018
Notes receivable, less current portion	$	16,216	$	27,491
Other		52,889		47,097
Other assets, net	$	69,105	$	74,588

Other Current Liabilities


	July 31, 2019		July 31, 2018
Customer deposits and advances		24,686		22,829
Accrued interest		16,550		18,288
Accrued payroll		17,356		16,060
Accrued insurance		18,524		15,100
Price risk management liabilities		14,198		1,832
Other		42,989		61,580
Other current liabilities	$	134,303	$	135,689

Shipping And Handling Expenses


	For the year ended July 31,
	2019		2018		2017
Operating expense	$	215,780	$	195,646	$	175,164
Depreciation and amortization expense		6,375		4,947		3,909
Equipment lease expense		30,759		25,765		26,299
	$	252,914	$	226,358	$	205,372

Cash Flow Supplemental Disclosures


	For the year ended July 31,
	2019		2018		2017
Cash paid (refunded) for:
Interest	$	136,106	$	128,479	$	122,084
Income taxes	$	111	$	(311)	$	305
Non-cash investing and financing activities:
Liabilities incurred in connection with acquisitions	$	1,650	$	1,993	$	139
Change in accruals for property, plant and equipment additions	$	1,132	$	264	$	164

Accounts And Notes Receivable, Net And Accounts Receivable Securitization (Tables)

12 Months Ended

Jul. 31, 2019

Accounts, Notes, Loans and Financing Receivable [Line Items]

Accounts And Notes Receivable


	July 31, 2019		July 31, 2018
Accounts receivable pledged as collateral	$	106,145	$	120,079
Accounts receivable not pledged as collateral (including other reserves)		1,218		8,272
Note receivable - current portion		2,660		132
Other		36		26
Less: Allowance for doubtful accounts		(2,463)		(2,455)
Accounts and notes receivable, net	$	107,596	$	126,054

Accounts, Notes, Loans and Financing Receivable [Line Items]

Accounts And Notes Receivable


	July 31, 2019		July 31, 2018
Accounts receivable pledged as collateral	$	106,145	$	120,079
Accounts receivable not pledged as collateral (including other reserves)		1,218		8,272
Note receivable - current portion		2,660		132
Other		36		26
Less: Allowance for doubtful accounts		(2,463)		(2,455)
Accounts and notes receivable, net	$	107,596	$	126,054

Goodwill And Intangible Assets, Net (Tables)

12 Months Ended

Jul. 31, 2019

Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items]

Schedule of Goodwill Rollforward


	July 31, 2019						July 31, 2018
	Gross Carrying		Accumulated				Gross Carrying		Accumulated
	Amount		Amortization		Net		Amount		Amortization		Net
Goodwill, net	$	247,195	$	—	$	247,195	$	246,098	$	—	$	246,098

Intangible assets, net
Amortized intangible assets
Customer related	$	442,652	$	(390,052)	$	52,600	$	441,393	$	(376,605)	$	64,788
Non-compete agreements		25,582		(20,645)		4,937		24,653		(19,511)		5,142
Other		3,513		(3,513)		—		3,513		(3,513)		—
		471,747		(414,210)		57,537		469,559		(399,629)		69,930

Unamortized intangible assets
Trade names & trademarks		51,020		—		51,020		51,021		—		51,021
Total intangible assets, net	$	522,767	$	(414,210)	$	108,557	$	520,580	$	(399,629)	$	120,951


	Propane operations and
	related equipment sales
Balance July 31, 2017	$	256,103
Impairment		(10,005)
Balance July 31, 2018		246,098
Acquisitions		1,410
Other		(313)
Balance July 31, 2019	$	247,195

Schedule Of Aggregate Amortization Expense


For the year ended July 31,
2019	$	14,581
2018		31,345
2017		32,148

Schedule Of Estimated Amortization Expense


For the year ended July 31,
2020	$	9,121
2021		8,382
2022		6,993
2023		6,666
2024		6,390

Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items]

Schedule of Goodwill Rollforward


	July 31, 2019						July 31, 2018
	Gross						Gross
	Carrying		Accumulated				Carrying		Accumulated
	Amount		Amortization		Net		Amount		Amortization		Net
Goodwill, net	$	247,195	$	—	$	247,195	$	246,098	$	—	$	246,098

Intangible assets, net
Amortized intangible assets
Customer related	$	442,652	$	(390,052)	$	52,600	$	441,393	$	(376,605)	$	64,788
Non-compete agreements		25,582		(20,645)		4,937		24,653		(19,511)		5,142
Other		3,513		(3,513)		—		3,513		(3,513)		—
		471,747		(414,210)		57,537		469,559		(399,629)		69,930

Unamortized intangible assets
Trade names & trademarks		51,020		—		51,020		51,021		—		51,021
Total intangible assets, net	$	522,767	$	(414,210)	$	108,557	$	520,580	$	(399,629)	$	120,951


	Propane operations and
	related equipment sales
Balance July 31, 2017	$	256,103
Impairment		(10,005)
Balance July 31, 2018		246,098
Acquisitions		1,410
Other		(313)
Balance July 31, 2019	$	247,195

Schedule Of Aggregate Amortization Expense


For the year ended July 31,
2019	$	14,581
2018		31,345
2017		32,148

Schedule Of Estimated Amortization Expense


For the year ended July 31,
2020	$	9,121
2021		8,382
2022		6,993
2023		6,666
2024		6,390

Debt (Tables)

12 Months Ended

Jul. 31, 2019

Schedule of Debt Components


	2019		2018
Senior notes
Fixed rate, 6.50%, due 2021 (1)	$	500,000	$	500,000
Fixed rate, 6.75%, due 2023 (2)		500,000		500,000
Fixed rate, 6.75%, due 2022, net of unamortized premium of $1,633 and $2,375 at 2019 and 2018, respectively (3)		476,633		477,375
Fixed rate, 8.625%, due 2020, net of unamortized discount of $1,319 and $3,766 at 2019 and 2018, respectively (4)		355,681		353,234

Senior secured term loan
Variable interest rate, Term Loan, expected to mature May 2023 (5)		275,000		275,000

Notes payable
10.7% and 11.2% weighted average interest rate at July 31, 2019 and 2018, respectively, due 2020 to 2029, net of unamortized discount of $711 and $977 at July 31, 2019 and 2018, respectively		5,962		6,221
Total debt, excluding unamortized debt issuance and other costs		2,113,276		2,111,830
Unamortized debt issuance and other costs		(24,516)		(30,791)
Less: current portion of long-term debt		631,756		2,402
Long-term debt	$	1,457,004	$	2,078,637

(1)

(2)

(3)

(4)

(5)

Scheduled Annual Principal Payments On Long-term Debt


	Scheduled annual
For the year ending July 31,	principal payments
2020	$	634,052
2021		501,842
2022		476,187
2023		500,756
2024		292
Thereafter		544
Total	$	2,113,673

Schedule of Debt Components


	2019		2018
Senior notes
Fixed rate, 6.50%, due 2021 (1)	$	500,000	$	500,000
Fixed rate, 6.75%, due 2023 (2)		500,000		500,000
Fixed rate, 6.75%, due 2022, net of unamortized premium of $1,633 and $2,375 at 2019 and 2018, respectively (3)		476,633		477,375

Senior secured term loan
Variable interest rate, Term Loan, expected to mature May 2023 (4)		275,000		275,000

Notes payable
10.7% and 11.2% weighted average interest rate at July 31, 2019 and 2018, respectively, due 2020 to 2029, net of unamortized discount of $711 and $977 at July 31, 2019 and 2018, respectively		5,962		6,221
Total debt, excluding unamortized debt issuance and other costs		1,757,595		1,758,596
Unamortized debt issuance and other costs		(23,562)		(28,057)
Less: current portion of long-term debt		277,029		2,402
Long-term debt	$	1,457,004	$	1,728,137

(1)

(2)

(3)

(4)

Scheduled Annual Principal Payments On Long-term Debt


For the year ending July 31,	Scheduled annual principal payments
2020	$	277,052
2021		501,842
2022		476,187
2023		500,756
2024		292
Thereafter		544
Total	$	1,756,673

Partners' deficit (Tables)

12 Months Ended

Jul. 31, 2019

Ferrellgas Recognized Cash Distributions

Limited Partner Units


	July 31, 2019	July 31, 2018
Public common unitholders (1)	69,612,939	69,612,939
Ferrell Companies (2)	22,529,361	22,529,361
FCI Trading Corp. (3)	195,686	195,686
Ferrell Propane, Inc. (4)	51,204	51,204
James E. Ferrell (5)	4,763,475	4,763,475

(1)

These common units are listed on the New York Stock Exchange under the symbol “FGP.”

(2)

(3)

FCI Trading is an affiliate of the general partner and thus a related party.

(4)

Ferrell Propane is controlled by the general partner and thus a related party.

(5)


	For the year ended July 31,
	2019		2018		2017
Public common unitholders	$	6,962	$	27,846	$	56,561
Ferrell Companies		2,253		9,012		18,305
FCI Trading Corp.		20		80		160
Ferrell Propane, Inc.		5		20		41
James E. Ferrell		476		1,904		3,869
General partner		98		392		797
	$	9,814	$	39,254	$	79,733

Ferrellgas Recognized Cash Distributions


	For the year ended July 31,
	2019		2018		2017
Ferrellgas Partners	$	40,706	$	70,246	$	102,978
General partner		415		716		1,050

Revenue from contracts with customers (Tables)

12 Months Ended

Jul. 31, 2019

Disaggregation of Revenue [Table Text Block]


	For the year ended July 31,
	2019		2018		2017
Retail - Sales to End Users	$	1,128,991	$	1,082,046	$	852,130
Wholesale - Sales to Resellers		419,349		448,943		396,100
Other Gas Sales		60,518		111,987		70,182
Other		75,534		147,847		145,162
Propane and related equipment revenues	$	1,684,392	$	1,790,823	$	1,463,574

Contract with Customer, Asset and Liability [Table Text Block]


	July 31, 2019		July 31, 2018
Accounts receivable	$	96,450	$	119,818
Contract assets	$	13,609	$	8,691
Contract liabilities
Deferred revenue (1)	$	31,974	$	29,933

(1)

Of the beginning balance of deferred revenue, $27.0 million was recognized as revenue during the year ended July 31, 2019.

Disaggregation of Revenue [Table Text Block]


	For the year ended July 31,
	2019		2018		2017
Retail - Sales to End Users	$	1,128,991	$	1,082,046	$	852,130
Wholesale - Sales to Resellers		419,349		448,943		396,100
Other Gas Sales		60,518		111,987		70,182
Other		75,534		147,847		145,162
Propane and related equipment revenues	$	1,684,392	$	1,790,823	$	1,463,574

Contract with Customer, Asset and Liability [Table Text Block]

	July 31, 2019		July 31, 2018
Accounts receivable	$	96,450	$	119,818
Contract assets	$	13,609	$	8,691
Contract liabilities
Deferred revenue (1)	$	31,974	$	29,933

(1)

Of the beginning balance of deferred revenue, $27.0 million was recognized as revenue during the year ended July 31, 2019.

Fair Value Measurement (Tables)

12 Months Ended

Jul. 31, 2019

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Assets and Liabilities Fair Value Hierarchy


	Asset (Liability)
	Quoted Prices in Active
	Markets for Identical		Significant Other
	Assets and Liabilities		Observable Inputs		Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
July 31, 2019:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	1,259	$	—	$	1,259
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(16,015)	$	—	$	(16,015)

July 31, 2018:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	22,470	$	—	$	22,470
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(1,910)	$	—	$	(1,910)

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Assets and Liabilities Fair Value Hierarchy


	Asset (Liability)
	Quoted Prices in Active
	Markets for Identical		Significant Other
	Assets and Liabilities		Observable Inputs		Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
July 31, 2019:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	1,259	$	—	$	1,259
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(16,015)	$	—	$	(16,015)

July 31, 2018:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	22,470	$	—	$	22,470
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(1,910)	$	—	$	(1,910)

Derivative Instruments and Hedging Activities (Tables)

12 Months Ended

Jul. 31, 2019

Fair Value of Financial Derivatives Balance Sheet Locations


	July 31, 2019
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	910	Other current liabilities	$	14,198
Commodity derivatives-propane	Other assets, net		349	Other liabilities		1,817
	Total	$	1,259	Total	$	16,015


	July 31, 2018
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	17,123	Other current liabilities	$	1,832
Commodity derivatives-propane	Other assets, net		5,347	Other liabilities		78
	Total	$	22,470	Total	$	1,910

Offsetting Assets And Liabilities [Table Text Block]


	July 31, 2019
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	25,028	Other current liabilities	$	1,217
	Other assets, net		2,969	Other liabilities		—
		$	27,997		$	1,217


	July 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	2,851	Other current liabilities	$	12,308
	Other assets, net		927	Other liabilities		4,235
		$	3,778		$	16,543

Fair Value Hedge Derivative Effect on Earnings


								Amount of Interest Expense
		Amount of Gain Recognized on						Recognized on Fixed-Rated Debt
	Location of Gain	Derivative						(Related Hedged Item)
	Recognized on	For the year ended July 31,						For the year ended July 31,
Derivative Instrument	Derivative	2019		2018		2017		2019		2018		2017
Interest rate swap agreements	Interest expense	$	—	$	266	$	1,319	$	—	$	(6,825)	$	(9,100)

Cash Flow Hedge Derivative Effect on Comprehensive Income


	For the year ended July 31, 2019
				Amount of Gain (Loss)
	Amount of Gain		Location of Gain (Loss)	Reclassified from
	(Loss) Recognized in		Reclassified from	AOCI into Income
Derivative Instrument	AOCI		AOCI into Income	Effective portion		Ineffective portion
Commodity derivatives	$	(48,184)	Cost of product sold- propane and other gas liquids sales	$	(12,868)	$	—
	$	(48,184)		$	(12,868)	$	—


	For the year ended July 31, 2018
				Amount of Gain (Loss)
	Amount of Gain (Loss)		Location of Gain (Loss)	Reclassified from
	Recognized in		Reclassified from	AOCI into Income
Derivative Instrument	AOCI		AOCI into Income	Effective portion		Ineffective portion
Commodity derivatives	$	30,231	Cost of product sold- propane and other gas liquids sales	$	24,714	$	—
Interest rate swap agreements		—	Interest expense		(395)		—
	$	30,231		$	24,319	$	—


	For the year ended July 31, 2017
				Amount of Gain (Loss)
	Amount of Gain (Loss)		Location of Gain (Loss)	Reclassified from
	Recognized in		Reclassified from	AOCI into Income
Derivative Instrument	AOCI		AOCI into Income	Effective portion		Ineffective portion
Commodity derivatives	$	21,659	Cost of sales-propane and other gas liquids sales	$	154	$	—
Interest rate swap agreements		866	Interest expense		(2,092)		—
	$	22,525		$	(1,938)	$	—

Derivatives not designated as hedging instruments effect on earnings


	For the year ended July 31, 2018
	Amount of Gain (Loss)		Location of Gain (Loss)
Derivatives Not Designated as Hedging Instruments	Recognized in Income		Reclassified in Income
Commodity derivatives - crude oil	$	(3,470)	Cost of sales - midstream operations


	For the year ended July 31, 2017
	Amount of Gain (Loss)		Location of Gain (Loss)
Derivatives Not Designated as Hedging Instruments	Recognized in Income		Reclassified in Income
Commodity derivatives - crude oil	$	(425)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,090	Operating expense

Changes in Derivative Value Effect on Other Comprehensive Income Loss


	For the year ended July 31,
Gains and losses on derivatives included in AOCI	2019		2018		2017
Beginning balance	$	20,560	$	14,648	$	(9,815)
Change in value of risk management commodity derivatives		(48,184)		30,231		21,659
Reclassification of (gains) losses on commodity hedges to cost of sales - propane and other gas liquids sales, net		12,868		(24,714)		(154)
Change in value of risk management interest rate derivatives		—		—		866
Reclassification of losses on interest rate hedges to interest expense		—		395		2,092
Ending balance	$	(14,756)	$	20,560	$	14,648

Fair Value of Financial Derivatives Balance Sheet Locations


	July 31, 2019
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	910	Other current liabilities	$	14,198
Commodity derivatives-propane	Other assets, net		349	Other liabilities		1,817
	Total	$	1,259	Total	$	16,015


	July 31, 2018
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	17,123	Other current liabilities	$	1,832
Commodity derivatives-propane	Other assets, net		5,347	Other liabilities		78
	Total	$	22,470	Total	$	1,910

Offsetting Assets And Liabilities [Table Text Block]


	July 31, 2019
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	25,028	Other current liabilities	$	1,217
	Other assets, net		2,969	Other liabilities		—
		$	27,997		$	1,217


	July 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	2,851	Other current liabilities	$	12,308
	Other assets, net		927	Other liabilities		4,235
		$	3,778		$	16,543

Fair Value Hedge Derivative Effect on Earnings


								Amount of Interest Expense
	Location of Gain	Amount of Gain Recognized on						Recognized on Fixed-Rated Debt
	Recognized on	Derivative						(Related Hedged Item)
Derivative Instrument	Derivative	For the year ended July 31,						For the year ended July 31,
		2019		2018		2017		2019		2018		2017
Interest rate swap agreements	Interest expense	$	—	$	266	$	1,319	$	—	$	(6,825)	$	(9,100)

Cash Flow Hedge Derivative Effect on Comprehensive Income


	For the year ended July 31, 2019
				Amount of Gain (Loss)
			Location of Gain (Loss)	Reclassified from
	Amount of Gain (Loss)		Reclassified from AOCI	AOCI into Income
Derivative Instrument	Recognized in AOCI		into Income	Effective portion		Ineffective portion
Commodity derivatives	$	(48,184)	Cost of product sold- propane and other gas liquids sales	$	(12,868)	$	—
	$	(48,184)		$	(12,868)	$	—


	For the year ended July 31, 2018
				Amount of Gain (Loss)
			Location of Gain (Loss)	Reclassified from
	Amount of Gain (Loss)		Reclassified from AOCI	AOCI into Income
Derivative Instrument	Recognized in AOCI		into Income	Effective portion		Ineffective portion
Commodity derivatives	$	30,231	Cost of product sold- propane and other gas liquids sales	$	24,714	$	—
Interest rate swap agreements		—	Interest expense		(395)		—
	$	30,231		$	24,319	$	—


	For the year ended July 31, 2017
				Amount of Gain (Loss)
			Location of Gain (Loss)	Reclassified from
	Amount of Gain (Loss)		Reclassified from AOCI	AOCI into Income
Derivative Instrument	Recognized in AOCI		into Income	Effective portion		Ineffective portion
Commodity derivatives	$	21,659	Cost of sales-propane and other gas liquids sales	$	154	$	—
Interest rate swap agreements		866	Interest expense		(2,092)		—
	$	22,525		$	(1,938)	$	—

Derivatives not designated as hedging instruments effect on earnings


	For the year ended July 31, 2018
	Amount of Gain (Loss)		Location of Gain (Loss)
Derivatives Not Designated as Hedging Instruments	Recognized in Income		Reclassified in Income
Commodity derivatives - crude oil	$	(3,470)	Cost of sales - midstream operations


	For the year ended July 31, 2017
	Amount of Gain (Loss)		Location of Gain (Loss)
Derivatives Not Designated as Hedging Instruments	Recognized in Income		Reclassified in Income
Commodity derivatives - crude oil	$	(425)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,090	Operating expense

Changes in Derivative Value Effect on Other Comprehensive Income Loss


	For the year ended July 31,
Gains and losses on derivatives included in AOCI	2019		2018		2017
Beginning balance	$	20,560	$	14,648	$	(9,815)
Change in value of risk management commodity derivatives		(48,184)		30,231		21,659
Reclassification of (gains) losses on commodity hedges to cost of sales - propane and other gas liquids sales, net		12,868		(24,714)		(154)
Change in value of risk management interest rate derivatives		—		—		866
Reclassification of losses on interest rate hedges to interest expense		—		395		2,092
Ending balance	$	(14,756)	$	20,560	$	14,648

Transactions With Related Parties (Tables)

12 Months Ended

Jul. 31, 2019

Allocation Of Transactions With Related Parties


	For the year ended July 31,
	2019		2018		2017
Operating expense	$	256,190	$	243,407	$	228,969

General and administrative expense	$	25,368	$	28,282	$	31,068

Allocation Of Transactions With Related Parties


	For the year ended July 31,
	2019		2018		2017
Operating expense	$	256,190	$	243,407	$	228,969

General and administrative expense	$	25,368	$	28,282	$	31,068

Contingencies And Commitments (Tables)

12 Months Ended

Jul. 31, 2019

Contractual Operating Lease Commitments And Buyouts


	Future minimum rental and buyout amounts by fiscal year
	2020		2021		2022		2023		2024		Thereafter
Operating lease obligations	$	44,392	$	36,134	$	26,312	$	20,432	$	17,196	$	17,414
Operating lease buyouts	$	3,073	$	4,371	$	6,421	$	3,527	$	1,238	$	14,433

Schedule of Restructuring Reserve by Type of Cost [Table Text Block]


	Contract exit
	costs
July 31, 2017	$	—
Net expense		11,804
Cash payments and other		—
July 31, 2018		11,804
Accretion		448
Cash payments and other		(802)
July 31, 2019	$	11,450

Contractual Operating Lease Commitments And Buyouts


	Future minimum rental and buyout amounts by fiscal year
	2020		2021		2022		2023		2024		Thereafter
Operating lease obligations	$	44,392	$	36,134	$	26,312	$	20,432	$	17,196	$	17,414
Operating lease buyouts		3,073		4,371		6,421		3,527		1,238		14,433

Schedule of Restructuring Reserve by Type of Cost [Table Text Block]


	Contract exit
	costs
July 31, 2017	$	—
Net expense		11,804
Cash payments and other		—
July 31, 2018		11,804
Accretion		448
Cash payments and other		(802)
July 31, 2019	$	11,450

Net Earnings (Loss) Per Common Unitholders' Interest (Tables)

12 Months Ended

Jul. 31, 2019

Earnings Per Share [Abstract]

Earnings Distribution Allocation


	Ratio of total distributions payable to:
Quarterly distribution per common unit	Common unitholder		General partner
$0.56 to $0.63	86.9	%	13.1	%
$0.64 to $0.82	76.8	%	23.2	%
$0.83 and above	51.5	%	48.5	%

Basic And Diluted Net Earnings Per Common Unitholders' Interest


	For the year ended July 31,
	2019		2018		2017

Common unitholders’ interest in net loss	$	(63,605)	$	(252,035)	$	(53,665)
Weighted average common units outstanding (in thousands)		97,152.7		97,152.7		97,229.5
Basic and diluted net loss per common unit	$	(0.65)	$	(2.59)	$	(0.55)

Segment Reporting (Tables)

12 Months Ended

Jul. 31, 2019

Schedule of Segment Reporting Information, by Segment


	Year ended July 31, 2019
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,684,392	$	—	$	1,684,392
Direct costs (1)		1,412,390		41,979		1,454,369
Adjusted EBITDA	$	272,002	$	(41,979)	$	230,023


	Year ended July 31, 2018
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,790,823	$	282,319	$	2,073,142
Direct costs (1)		1,514,755		316,468		1,831,223
Adjusted EBITDA	$	276,068	$	(34,149)	$	241,919


	Year ended July 31, 2017
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,463,574	$	466,703	$	1,930,277
Direct costs (1)		1,198,150		502,064		1,700,214
Adjusted EBITDA	$	265,424	$	(35,361)	$	230,063

(1)

Reconciliation of Net Earnings to Total Segment Performance Measures


	Year ended July 31,
	2019		2018		2017
Net loss attributable to Ferrellgas Partners, L.P.	$	(64,247)	$	(254,581)	$	(54,207)
Income tax expense (benefit)		323		(2,678)		(1,143)
Interest expense		177,619		168,467		152,485
Depreciation and amortization expense		78,846		101,795		103,351
EBITDA		192,541		13,003		200,486
Non-cash employee stock ownership plan compensation charge		5,693		13,859		15,088
Non-cash stock-based compensation charge		—		—		3,298
Asset impairments		—		10,005		—
Loss on asset sales and disposals		10,968		187,399		14,457
Other income, net		(369)		(928)		(1,474)
Severance costs		1,600		1,663		1,959
Legal fees and settlements related to non-core businesses		18,364		6,065		—
Unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments		—		1,293		(3,457)
Multi-employer pension plan withdrawal settlement		1,524		—		—
Exit costs associated with contracts - Midstream dispositions		—		11,804		—
Net loss attributable to noncontrolling interest		(298)		(2,244)		(294)
Adjusted EBITDA	$	230,023	$	241,919	$	230,063

Reconciliation of Assets from Segment to Consolidated


Assets	July 31, 2019		July 31, 2018
Propane operations and related equipment sales	$	1,223,790	$	1,196,084
Corporate and other		39,169		167,197
Total consolidated assets	$	1,262,959	$	1,363,281

Schedule Of Capital Expenditures By Segment [Table Text Block]


	Year ended July 31, 2019
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	44,439	$	2,614	$	47,053
Growth		56,145		—		56,145
Total	$	100,584	$	2,614	$	103,198


	Year ended July 31, 2018
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	23,979	$	3,584	$	27,563
Growth		51,229		1,255		52,484
Total	$	75,208	$	4,839	$	80,047


	Year ended July 31, 2017
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	13,330	$	3,808	$	17,138
Growth		28,912		315		29,227
Total	$	42,242	$	4,123	$	46,365

Schedule of Segment Reporting Information, by Segment


	Year ended July 31, 2019
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,684,392	$	—	$	1,684,392
Direct costs (1)		1,412,299		41,056		1,454,355
Adjusted EBITDA	$	272,093	$	(41,056)	$	230,037


	Year ended July 31, 2018
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,790,823	$	282,319	$	2,073,142
Direct costs (1)		1,514,755		316,331		1,831,086
Adjusted EBITDA	$	276,068	$	(34,012)	$	242,056


	Year ended July 31, 2017
	Propane operations
	and related equipment		Corporate and
	sales		other		Total
Segment revenues	$	1,463,574	$	466,703	$	1,930,277
Direct costs (1)		1,198,150		501,925		1,700,075
Adjusted EBITDA	$	265,424	$	(35,222)	$	230,202

(1)

Reconciliation of Net Earnings to Total Segment Performance Measures


	Year ended July 31,
	2019		2018		2017

Net loss	$	(29,517)	$	(222,146)	$	(29,059)
Income tax expense (benefit)		293		(2,699)		(1,149)
Interest expense		142,635		133,946		127,188
Depreciation and amortization expense		78,846		101,795		103,351
EBITDA		192,257		10,896		200,331
Non-cash employee stock ownership plan compensation charge		5,693		13,859		15,088
Non-cash stock-based compensation charge		—		—		3,298
Asset impairments		—		10,005		—
Loss on asset sales and disposals		10,968		187,399		14,457
Other income, net		(369)		(928)		(1,474)
Severance costs		1,600		1,663		1,959
Legal fees and settlements related to non-core businesses		18,364		6,065		—
Unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments		—		1,293		(3,457)
Multi-employer pension plan withdrawal settlement		1,524		—		—
Exit costs associated with contracts - Midstream dispositions		—		11,804		—
Adjusted EBITDA	$	230,037	$	242,056	$	230,202

Reconciliation of Assets from Segment to Consolidated


	July 31, 2019		July 31, 2018
Assets
Propane operations and related equipment sales	$	1,223,790	$	1,196,084
Corporate and other		39,043		167,162
Total consolidated assets	$	1,262,833	$	1,363,246

Schedule Of Capital Expenditures By Segment [Table Text Block]


	Year ended July 31, 2019
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	44,439	$	2,614	$	47,053
Growth		56,145		—		56,145
Total	$	100,584	$	2,614	$	103,198


	Year ended July 31, 2018
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	23,979	$	3,584	$	27,563
Growth		51,229		1,255		52,484
Total	$	75,208	$	4,839	$	80,047


	Year Ended July 31, 2017
	Propane operations and
	related equipment sales		Corporate and other		Total
Capital expenditures:
Maintenance	$	13,330	$	3,808	$	17,138
Growth		28,912		315		29,227
Total	$	42,242	$	4,123	$	46,365

Quarterly Data (Unaudited) (Tables)

12 Months Ended

Jul. 31, 2019

Interim Period, Costs Not Allocable [Line Items]

Summarized Unaudited Quarterly Data


For the year ended July 31, 2019	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	352,309	$	573,377	$	479,625	$	279,081
Gross margin from propane and other gas liquids sales (a)		130,830		238,581		209,167		127,764
Net earnings (loss)		(57,508)		43,875		20,760		(71,672)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.		(57,015)		43,344		20,461		(71,037)
Common unitholders’ interest in net earnings (loss)		(56,445)		42,911		20,256		(70,327)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.58)	$	0.44	$	0.21	$	(0.72)


For the year ended July 31, 2018	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	454,655	$	755,156	$	515,810	$	347,521
Gross margin from propane and other gas liquids sales (a)		123,243		229,321		190,883		126,115
Gross margin from midstream operations (b)		12,635		10,209		8,077		(4,161)
Net earnings (loss) (c)		(48,316)		(1,774)		11,062		(217,797)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.		(47,915)		(1,843)		10,861		(215,684)
Common unitholders’ interest in net earnings (loss)		(47,436)		(1,824)		10,752		(213,527)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.49)	$	(0.02)	$	0.11	$	(2.20)


For the year ended July 31, 2017	First quarter		Second quarter		Third quarter		Fourth quarter
Revenues	$	379,542	$	579,250	$	538,109	$	433,376
Gross margin from propane and other gas liquids sales (a)		123,187		202,346		171,950		126,774
Gross margin from midstream operations (b)		13,402		9,763		7,909		6,190
Net earnings (loss)		(43,471)		38,528		6,691		(56,249)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.		(43,073)		38,098		6,536		(55,768)
Common unitholders’ interest in net earnings (loss)		(42,462)		37,717		6,470		(55,210)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.44)	$	0.39	$	0.07	$	(0.57)

(a)

Gross margin from “Propane and other gas liquids sales” represents “Revenues - propane and other gas liquids sales” less “Cost of sales – propane and other gas liquids sales.”

(b)

Gross margin from “Midstream operations” represents “Revenues - midstream operations” less “Cost of sales - midstream operations.”

Includes asset impairment charges of $10.0 million in the second quarter of fiscal 2018.