Guarantor financial information | M. Guarantor financial information The $500.0 million aggregate principal amount of 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 condensed consolidated financial statements. FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEETS (in thousands) As of April 30, 2020 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 $ 318,836 $ 1 $ — $ — $ — $ 318,837 Accounts and notes receivable, net 10,642 — 24 132,286 — 142,952 Intercompany receivables 99,362 — — — (99,362) — Inventories 65,209 — — — — 65,209 Prepaid expenses and other current assets 47,175 — — — — 47,175 Total current assets 541,224 1 24 132,286 (99,362) 574,173 Property, plant and equipment, net 596,978 — — — — 596,978 Goodwill, net 247,195 — — — — 247,195 Intangible assets, net 103,966 — — — — 103,966 Investments in consolidated subsidiaries 37,505 — — — (37,505) — Operating lease right-of-use assets 110,497 — — — — 110,497 Other assets, net 84,772 — 2,255 445 — 87,472 Total assets $ 1,722,137 $ 1 $ 2,279 $ 132,731 $ (136,867) $ 1,720,281 LIABILITIES AND PARTNERS' CAPITAL (DEFICIT) Current liabilities: Accounts payable $ 37,025 $ — $ — $ — $ — $ 37,025 Intercompany payables — — — 99,362 (99,362) — Current portion of long-term debt 2,050 — — — — 2,050 Current operating lease liabilities 31,914 — — 31,914 Other current liabilities 165,047 — 12 (1,868) — 163,191 Total current liabilities 236,036 — 12 97,494 (99,362) 234,180 Long-term debt 2,146,044 — — — — 2,146,044 Operating lease liabilities 76,133 — — — — 76,133 Other liabilities 52,167 — — — — 52,167 Contingencies and commitments Partners' capital (deficit): Partners' equity (767,465) 1 2,267 35,237 (37,505) (767,465) Accumulated other comprehensive loss (20,778) — — — — (20,778) Total partners' capital (deficit) (788,243) 1 2,267 35,237 (37,505) (788,243) Total liabilities and partners' capital (deficit) $ 1,722,137 $ 1 $ 2,279 $ 132,731 $ (136,867) $ 1,720,281 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 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 income (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 STATEMENTS OF OPERATIONS (in thousands) For the three months ended April 30, 2020 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 $ 391,745 $ — $ — $ — $ — $ 391,745 Other 20,385 — — — — 20,385 Total revenues 412,130 — — — — 412,130 Costs and expenses: Cost of sales - propane and other gas liquids sales 176,265 — — — — 176,265 Cost of sales - other 2,740 — — — — 2,740 Operating expense - personnel, vehicle, plant and other 121,558 — — 1,314 (1,314) 121,558 Operating expense - equipment lease expense 8,075 — — — — 8,075 Depreciation and amortization expense 20,252 — — 114 — 20,366 General and administrative expense 12,555 — — — — 12,555 Non-cash employee stock ownership plan compensation charge 757 — — — — 757 Loss on asset sales and disposals 1,859 — — — — 1,859 Operating income (loss) 68,069 — — (1,428) 1,314 67,955 Interest expense (36,943) — — (1,063) — (38,006) Loss on extinguishment of debt (37,399) — — — — (37,399) Other income (expense), net (158) — — 1,351 (1,351) (158) Earnings (loss) before income taxes (6,431) — — (1,140) (37) (7,608) Income tax expense 112 — — — — 112 Equity in earnings (loss) of subsidiaries (1,140) — — — 1,140 — Net earnings (loss) (7,683) — — (1,140) 1,103 (7,720) Other comprehensive income 2,572 — — — — 2,572 Comprehensive income (loss) $ (5,111) $ — $ — $ (1,140) $ 1,103 $ (5,148) FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (in thousands) For the three months ended April 30, 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 $ 459,556 $ — $ — $ — $ — $ 459,556 Other 20,069 — — — — 20,069 Total revenues 479,625 — — — — 479,625 Costs and expenses: Cost of sales - propane and other gas liquids sales 250,389 — — — — 250,389 Cost of sales - other 2,320 — — — — 2,320 Operating expense - personnel, vehicle, plant and other 124,078 — (3) 968 (5,052) 119,991 Operating expense - equipment lease expense 8,319 — — — — 8,319 Depreciation and amortization expense 20,506 — — 111 — 20,617 General and administrative expense 11,511 1 — — — 11,512 Non-cash employee stock ownership plan compensation charge (4) — — — — (4) Loss on asset sales and disposals 1,683 — — — — 1,683 Operating income (loss) 60,823 (1) 3 (1,079) 5,052 64,798 Interest expense (34,206) — — (1,189) — (35,395) Other income (expense), net 278 — (27) 2,834 (2,834) 251 Earnings (loss) before income taxes 26,895 (1) (24) 566 2,218 29,654 Income tax expense (benefit) (49) — 149 — — 100 Equity in earnings (loss) of subsidiary 392 — — — (392) — Net earnings (loss) 27,336 (1) (173) 566 1,826 29,554 Other comprehensive loss 8,286 — — — — 8,286 Comprehensive income (loss) $ 35,622 $ (1) $ (173) $ 566 $ 1,826 $ 37,840 FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (in thousands) For the nine months ended April 30, 2020 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 $ 1,150,377 $ — $ — $ — $ — $ 1,150,377 Other 65,800 — — — — 65,800 Total revenues 1,216,177 — — — — 1,216,177 Costs and expenses: Cost of sales - propane and other gas liquids sales 548,136 — — — — 548,136 Cost of sales - other 9,774 — — — — 9,774 Operating expense - personnel, vehicle, plant and other 364,334 — — — — 364,334 Operating expense - equipment lease expense 24,724 — — 3,249 (3,249) 24,724 Depreciation and amortization expense 59,043 — — 337 — 59,380 General and administrative expense 36,332 4 — — — 36,336 Non-cash employee stock ownership plan compensation charge 2,182 — — — — 2,182 Loss on asset sales and disposals 6,242 — — — — 6,242 Operating income (loss) 165,410 (4) — (3,586) 3,249 165,069 Interest expense (110,412) — — (3,161) — (113,573) Loss on extinguishment of debt (37,399) — — — — (37,399) Other income (expense), net (214) — — 3,953 (3,953) (214) Earnings (loss) before income taxes 17,385 (4) — (2,794) (704) 13,883 Income tax expense 745 — — — — 745 Equity in earnings (loss) of subsidiary (2,798) — — — 2,798 — Net earnings (loss) 13,842 (4) — (2,794) 2,094 13,138 Other comprehensive loss (6,131) — — — — (6,131) Comprehensive income (loss) $ 7,711 $ (4) $ — $ (2,794) $ 2,094 $ 7,007 FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (in thousands) For the nine months ended April 30, 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 $ 1,344,634 $ — $ — $ — $ — $ 1,344,634 Other 60,628 — 49 — — 60,677 Total revenues 1,405,262 — 49 — — 1,405,311 Costs and expenses: Cost of sales - propane and other gas liquids sales 766,056 — — — — 766,056 Cost of sales - other 8,675 — 114 — — 8,789 Operating expense - personnel, vehicle, plant and other 355,589 — 36 3,869 (7,953) 351,541 Operating expense - equipment lease expense 24,597 — — — — 24,597 Depreciation and amortization expense 58,880 — — 334 — 59,214 General and administrative expense 42,022 6 — — — 42,028 Non-cash employee stock ownership plan compensation charge 4,688 — — — — 4,688 Loss on asset sales and disposals 5,724 — 2,679 — — 8,403 Operating income (loss) 139,031 (6) (2,780) (4,203) 7,953 139,995 Interest expense (103,209) — (38) (3,493) — (106,740) Other income (expense), net 393 — (37) 7,953 (7,953) 356 Earnings (loss) before income taxes 36,215 (6) (2,855) 257 — 33,611 Income tax expense 105 — 149 — — 254 Equity in earnings (loss) of subsidiaries (2,753) — — — 2,753 — Net earnings (loss) 33,357 (6) (3,004) 257 2,753 33,357 Other comprehensive loss (21,574) — — — — (21,574) Comprehensive income (loss) $ 11,783 $ (6) $ (3,004) $ 257 $ 2,753 $ 11,783 FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (in thousands) For the nine months ended April 30, 2020 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 $ 60,132 $ (4) $ 513 $ (8,862) $ 62,000 $ 113,779 Cash flows from investing activities: Business acquisitions, net of cash acquired (6,400) — — — — (6,400) Capital expenditures (57,251) — — — — (57,251) Proceeds from sale of assets 2,510 — — — — 2,510 Cash collected for purchase of interest in accounts receivable — — — 685,640 (685,640) — Cash remitted to Ferrellgas, L.P. for accounts receivable — — — (623,640) 623,640 — Intercompany loan to affiliate (8,353) — — — 8,353 — Cash payments to construct assets in connection with future lease transactions (37,042) — — — — (37,042) Cash receipts in connection with leased vehicles 21,995 — — — — 21,995 Net cash provided by (used in) investing activities (84,541) — — 62,000 (53,647) (76,188) Cash flows from financing activities: Distributions (15,654) — — — — (15,654) Proceeds from increase in long-term debt 703,750 — — — — 703,750 Reductions in long-term debt (285,285) — — — — (285,285) Net reductions to short-term borrowings (43,000) — — — — (43,000) Net additions to collateralized short-term borrowings — — — (62,000) — (62,000) Net changes in advances with consolidated entities — 4 (513) 8,862 (8,353) — Cash paid for financing costs and other (27,611) — — — — (27,611) Net cash provided by (used in) financing activities 332,200 4 (513) (53,138) (8,353) 270,200 Net change in cash and cash equivalents 307,791 — — — — 307,791 Cash and cash equivalents - beginning of year 11,045 1 — — — 11,046 Cash, cash equivalents and restricted cash - end of year $ 318,836 $ 1 $ — $ — $ — $ 318,837 FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (in thousands) For the nine months ended April 30, 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 $ 111,008 $ (6) $ 24,589 $ (45,384) $ (4,000) $ 86,207 Cash flows from investing activities: Business acquisitions, net of cash acquired (11,351) — — — — (11,351) Capital expenditures (94,660) — — — — (94,660) Proceeds from sale of assets 2,416 — — — — 2,416 Cash collected for purchase of interest in accounts receivable — — — 1,052,947 (1,052,947) — Cash remitted to Ferrellgas, L.P. for accounts receivable — — — (1,056,947) 1,056,947 — Intercompany loan to affiliate (20,638) — — — 20,638 — Other — — — — — — Net cash provided by (used in) investing activities (124,233) — — (4,000) 24,638 (103,595) Cash flows from financing activities: Distributions (25,568) — — — — (25,568) Reductions in long-term debt (1,656) — — — — (1,656) Net reductions in short-term borrowings (32,800) — — — — (32,800) Net additions to collateralized short-term borrowings — — — 4,000 — 4,000 Net changes in advances with consolidated entries — 6 (24,763) 45,395 (20,638) — Cash paid for financing costs (520) — — (11) — (531) Net cash provided by (used in) financing activities (60,544) 6 (24,763) 49,384 (20,638) (56,555) Net change in cash and cash equivalents (73,769) — (174) — — (73,943) Cash and cash equivalents - beginning of year 119,133 1 174 — — 119,308 Cash and cash equivalents - end of year $ 45,364 $ 1 $ — $ — $ — $ 45,365 |