Ferrellgas Partners 10Q 2007 Q3 Quarterly report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


þ		Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended April 30, 2007


o		Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission file numbers: 001-11331, 333-06693, 000-50182 and 000-50183

Ferrellgas Partners, L.P.
Ferrellgas Partners Finance Corp.
Ferrellgas, L.P.
Ferrellgas Finance Corp.

(Exact name of registrants as specified in their charters)


Delaware		43-1698480
Delaware		43-1742520
Delaware		43-1698481
Delaware		14-1866671

(States or other jurisdictions of		(I.R.S. Employer Identification Nos.)
incorporation or organization)

7500 College Boulevard, Suite 1000, Overland Park, KS 66210

(Address of principal executive offices) (Zip Code)

(913) 661-1500
(Registrants’ telephone number, including area code)

Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days.

Yesþ Noo

Indicate by check mark whether the registrants are large accelerated filers, accelerated filers, or non-accelerated filers. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Ferrellgas Partners, L.P.

Large accelerated filerþ Accelerated filero Non-accelerated filero

Ferrellgas Partners Finance Corp., Ferrellgas, L.P. and Ferrellgas Finance Corp.

Large accelerated filero Accelerated filero Non-accelerated filerþ

Indicate by check mark whether the registrants are shell companies (as defined in Rule 12b-2 of the Exchange Act).


Ferrellgas Partners, L.P. and Ferrellgas, L.P.	Yeso	Noþ

Ferrellgas Partners Finance Corp. and Ferrellgas Finance Corp.	Yesþ	Noo

At May 31, 2007, the registrants had common units or shares of common stock outstanding as follows:


Ferrellgas Partners, L.P.	62,957,674	Common Units
Ferrellgas Partners Finance Corp.	1,000	Common Stock
Ferrellgas, L.P.	n/a	n/a
Ferrellgas Finance Corp.	1,000	Common Stock

EACH OF FERRELLGAS PARTNERS FINANCE CORP. AND FERRELLGAS FINANCE CORP. MEET THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION (H)(1) (A) AND (B) OF FORM 10-Q AND ARE THEREFORE, WITH RESPECT TO EACH SUCH REGISTRANT, FILING THIS FORM 10-Q WITH THE REDUCED DISCLOSURE FORMAT.

FERRELLGAS PARTNERS, L.P.
FERRELLGAS PARTNERS FINANCE CORP.
FERRELLGAS, L.P.
FERRELLGAS FINANCE CORP.

For the quarterly period ended April 30, 2007
FORM 10-Q QUARTERLY REPORT

Table of Contents


		Page
PART I — FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS (unaudited)

	Ferrellgas Partners, L.P. and Subsidiaries

	Condensed Consolidated Balance Sheets – April 30, 2007 and July 31, 2006		1

	Condensed Consolidated Statements of Earnings – Three and nine months ended April 30, 2007 and 2006		2

	Condensed Consolidated Statement of Partners’ Capital – Nine months ended April 30, 2007		3

	Condensed Consolidated Statements of Cash Flows – Nine months ended April 30, 2007 and 2006		4

	Notes to Condensed Consolidated Financial Statements		5

	Ferrellgas Partners Finance Corp.

	Condensed Balance Sheets – April 30, 2007 and July 31, 2006		14

	Condensed Statements of Earnings – Three and nine months ended April 30, 2007 and 2006		14

	Condensed Statements of Cash Flows – Nine months ended April 30, 2007 and 2006		15

	Note to Condensed Financial Statements		15

	Ferrellgas, L.P. and Subsidiaries

	Condensed Consolidated Balance Sheets – April 30, 2007 and July 31, 2006		16

	Condensed Consolidated Statements of Earnings – Three and nine months ended April 30, 2007 and 2006		17

	Condensed Consolidated Statement of Partners’ Capital – Nine months ended April 30, 2007		18

	Condensed Consolidated Statements of Cash Flows – Nine months ended April 30, 2007 and 2006		19

	Notes to Condensed Consolidated Financial Statements		20

	Ferrellgas Finance Corp.

	Condensed Balance Sheets – April 30, 2007 and July 31, 2006		28

	Condensed Statements of Earnings – Three and nine months ended April 30, 2007 and 2006		28


		Page
	Condensed Statements of Cash Flows – Nine months ended April 30, 2007 and 2006		29

	Note to Condensed Financial Statements		29

ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		30

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		40

ITEM 4.	CONTROLS AND PROCEDURES		42

PART II – OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS		42

ITEM 1A.	RISK FACTORS		42

ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		43

ITEM 3.	DEFAULTS UPON SENIOR SECURITIES		43

ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS		43

ITEM 5.	OTHER INFORMATION		43

ITEM 6.	EXHIBITS		44

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (unaudited)

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)

(unaudited)


	April 30,			July 31,
	2007			2006
ASSETS

Current assets:
Cash and cash equivalents	$	23,830		$	16,525
Accounts and notes receivable, net		146,171			116,369
Inventories		98,684			154,613
Prepaid expenses and other current assets		18,828			15,334

Total current assets		287,513			302,841

Property, plant and equipment, net		729,490			740,101
Goodwill		249,325			246,050
Intangible assets, net		251,216			248,546
Other assets, net		18,443			11,962

Total assets	$	1,535,987		$	1,549,500


LIABILITIES AND PARTNERS’ CAPITAL

Current liabilities:
Accounts payable	$	64,250		$	82,212
Short-term borrowings		33,006			52,647
Other current liabilities		102,326			140,738

Total current liabilities		199,582			275,597

Long-term debt		1,003,811			983,545
Other liabilities		20,585			19,178
Contingencies and commitments (Note I)		—			—
Minority interest		5,870			5,435

Partners’ capital:
Common unitholders (62,952,174 and 60,885,784 units outstanding at April 30, 2007 and July 31, 2006, respectively)		356,077			321,194
General partner (635,881 and 615,008 units outstanding at April 30, 2007 and July 31, 2006, respectively)		(56,477	)		(56,829	)
Accumulated other comprehensive income		6,539			1,380

Total partners’ capital		306,139			265,745

Total liabilities and partners’ capital	$	1,535,987		$	1,549,500

See notes to condensed consolidated financial statements.

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(in thousands, except per unit data)
(unaudited)


	For the three months						For the nine months
	ended April 30,						ended April 30,
	2007			2006			2007			2006
Revenues:
Propane and other gas liquids sales	$	531,816		$	466,832		$	1,458,732		$	1,400,631
Other		92,346			59,194			204,616			163,561

		624,162			526,026			1,663,348			1,564,192

Costs and expenses:
Cost of product sold — propane and other gas liquids sales		341,593			288,364			956,288			919,626
Cost of product sold — other		72,118			43,319			142,039			101,788
Operating expense		97,369			95,085			287,224			281,894
Depreciation and amortization expense		22,245			21,138			65,936			63,864
General and administrative expense		11,829			12,326			32,877			34,793
Equipment lease expense		6,675			6,506			19,773			20,723
Employee stock ownership plan compensation charge		2,721			2,597			8,301			7,521
Loss on disposal of assets and other		3,097			2,881			9,592			5,518


Operating income		66,515			53,810			141,318			128,465

Interest expense		(21,534	)		(20,778	)		(66,243	)		(62,893	)
Interest income		981			557			2,871			1,465


Earnings before income taxes and minority interest		45,962			33,589			77,946			67,037

Income tax expense		1,752			2,271			3,634			2,971
Minority interest		507			377			933			829


Net earnings		43,703			30,941			73,379			63,237

Net earnings available to general partner unitholder		1,860			309			734			632

Net earnings available to common unitholders	$	41,843		$	30,632		$	72,645		$	62,605


Basic and diluted net earnings available to common unitholders	$	0.66		$	0.51		$	1.16		$	1.04

See notes to condensed consolidated financial statements.

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF PARTNERS’ CAPITAL
(in thousands)
(unaudited)


												Accumulated other
	Number of units											comprehensive income (loss)
				General					General						Currency						Total
	Common			partner		Common			partner			Risk			translation			Pension			partners’
	unitholders			unitholder		unitholders			unitholder			management			adjustments			liability			capital
Balance at July 31, 2006		60,885.8			615.0	$	321,194		$	(56,829	)	$	2,126		$	21		$	(767	)	$	265,745

Contributions in connection with ESOP and stock-based compensation charges		—			—		9,277			93			—			—			—			9,370

Common unit distributions		—			—		(94,323	)		(952	)		—			—			—			(95,275	)

Common units issued		1,891.9	��		19.1		43,765			442			—			—			—			44,207

Common unit options exercised		50.0			0.5		903			9			—			—			—			912

Common units issued in connection with acquisitions, net of issuance costs		124.5			1.3		2,616			26			—			—			—			2,642

Comprehensive income:
Net earnings		—			—		72,645			734			—			—			—			73,379
Other comprehensive income (loss):
Net gain on risk management derivatives		—			—		—			—			7,273			—			—
Reclassification of derivatives to earnings		—			—		—			—			(2,126	)		—			—
Foreign currency translation adjustments		—			—		—			—			—			(52	)		—
Tax effect on foreign currency translation adjustments																(1	)
Pension liability adjustment																			65			5,159

Comprehensive income																						78,538


Balance at April 30, 2007		62,952.2			635.9	$	356,077		$	(56,477	)	$	7,273		$	(32	)	$	(702	)	$	306,139

See notes to condensed consolidated financial statements.

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)


	For the nine months
	ended April 30,
	2007			2006
Cash flows from operating activities:
Net earnings	$	73,379		$	63,237
Reconciliation of net earnings to net cash provided by operating activities:
Depreciation and amortization expense		65,936			63,864
Employee stock ownership plan compensation charge		8,301			7,521
Stock-based compensation charge		1,165			1,581
Loss on disposal of assets		3,935			303
Loss on transfer of accounts receivable related to the accounts receivable securitization		8,699			8,171
Minority interest		933			829
Other		2,660			5,590
Changes in operating assets and liabilities, net of effects from business acquisitions:
Accounts and notes receivable, net of securitization		(70,083	)		(77,885	)
Inventories		56,107			(11,086	)
Prepaid expenses and other current assets		1,532			(127	)
Accounts payable		(19,481	)		11,054
Other current liabilities		(33,353	)		(13,706	)
Other liabilities		1,558			(30	)
Accounts receivable securitization:
Proceeds from new accounts receivable securitizations		100,000			102,000
Proceeds from collections reinvested in revolving period accounts receivable securitizations		971,022			976,608
Remittances of amounts collected as servicer of accounts receivable securitizations		(1,035,022	)		(1,044,608	)

Net cash provided by operating activities		137,288			93,316


Cash flows from investing activities:
Business acquisitions, net of cash acquired		(31,055	)		(13,500	)
Capital expenditures		(35,813	)		(29,207	)
Proceeds from sale of assets		7,069			15,734
Other		(4,902	)		(4,211	)

Net cash used in investing activities		(64,701	)		(31,184	)


Cash flows from financing activities:
Distributions		(95,275	)		(91,447	)
Issuance of common units, net of issuance costs of $304		44,241			—
Proceeds from increase in long-term debt		65,241			28,748
Reductions in long-term debt		(59,914	)		(1,773	)
Net (reductions) additions to short-term borrowings		(19,641	)		5,852
Cash paid for financing costs		(171	)		(226	)
Minority interest activity		(1,092	)		(1,056	)
Proceeds from exercise of common unit options		912			1,957
Cash contributions from general partner		470			16

Net cash used in financing activities		(65,229	)		(57,929	)


Effect of exchange rate changes on cash		(53	)		(18	)

Increase in cash and cash equivalents		7,305			4,185
Cash and cash equivalents — beginning of year		16,525			20,505

Cash and cash equivalents — end of period	$	23,830		$	24,690

See notes to condensed consolidated financial statements.

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
April 30, 2007
(Dollars in thousands, except per unit data, unless otherwise designated)
(unaudited)

A.		Partnership organization and formation

		Ferrellgas Partners, L.P. (“Ferrellgas Partners”) is a publicly traded limited partnership, owning an approximate 99% limited partner interest in Ferrellgas, L.P. (the “operating partnership”). Ferrellgas Partners and the operating partnership are collectively referred to as “Ferrellgas.” Ferrellgas, Inc. (the “general partner”), a wholly-owned subsidiary of Ferrell Companies, Inc. (“Ferrell Companies”), has retained a 1% general partner interest in Ferrellgas Partners and also holds an approximate 1% general partner interest in the operating partnership, representing an effective 2% general partner interest in Ferrellgas on a combined basis. As general partner, it performs all management functions required by Ferrellgas. Ferrell Companies beneficially owns 20.3 million of Ferrellgas Partners’ outstanding common units.

		Ferrellgas Partners is a holding entity that conducts no operations and has two subsidiaries, Ferrellgas Partners Finance Corp. and the operating partnership. Ferrellgas Partners owns a 100% equity interest in Ferrellgas Partners Finance Corp., whose only purpose is to act as the co-issuer and co-obligor of any debt issued by Ferrellgas Partners. The operating partnership is the only operating subsidiary of Ferrellgas Partners.

		The condensed consolidated financial statements of Ferrellgas reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the interim periods presented. All adjustments to the condensed consolidated financial statements were of a normal, recurring nature. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes, as set forth in Ferrellgas’ Annual Report on Form 10-K for fiscal 2006.

B.		Summary of significant accounting policies

(1) Nature of operations:

The operating partnership is engaged primarily in the distribution of propane and related equipment and supplies in the United States. The propane distribution market is seasonal because propane is used primarily for heating in residential and commercial buildings. Therefore, the results of operations for the nine months ended April 30, 2007 and 2006 are not necessarily indicative of the results to be expected for a full fiscal year. The operating partnership serves more than one million residential, industrial/commercial, portable tank exchange, agricultural and other customers in all 50 states, the District of Columbia and Puerto Rico.

(2) 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 condensed 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 assets, residual values of tanks, capitalization of customer tank installation costs, amortization methods of intangible assets, and valuation methods used to value sales returns and allowances, allowance for doubtful accounts, derivative commodity contracts and stock and unit-based compensation calculations.

(3) Supplemental cash flow information:


	For the nine months ended
	April 30,
	2007		2006
CASH PAID FOR:
Interest	$	63,917	$	59,393
Income taxes	$	2,877	$	609
NON-CASH INVESTING ACTIVITIES:
Issuance of common units in connection with acquisitions	$	2,751	$	5,637
Issuance of liabilities in connection with acquisitions	$	2,331	$	2,290
Property, plant and equipment additions	$	1,519	$	1,213

(4) New accounting standards:

Statement of Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. This statement is effective for fiscal years beginning after November 15, 2007. Ferrellgas is currently evaluating the potential impact of this statement.

SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans,” requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan as either an asset or liability in the statement of financial position and to recognize changes in that funded status through other comprehensive income. This statement also requires companies to measure plan assets and benefit obligations as of the date of the company’s fiscal year-end. The recognition provisions of this statement are effective as of the end of fiscal years ending after December 15, 2006, while the measurement date provisions are effective as of the end of fiscal years ending after December 15, 2008. Ferrellgas does not believe the adoption of either provision of this statement will have a significant impact on its financial position, results of operations and cash flows.

SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities,” provides entities the irrevocable option to elect to carry most financial assets and liabilities at fair value with changes in fair value recorded in earnings. This statement is effective for fiscal years beginning after November 15, 2007. Ferrellgas is currently evaluating the potential impact of this statement.

Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB 108”), provides guidance on the quantification of prior year misstatements. SAB 108 requires that registrants use both the income statement (roll-over) approach and the balance sheet (iron curtain) approach when evaluating the materiality of a misstatement and contains guidance for correcting the errors under this dual approach. SAB 108 is effective for fiscal years ending after November 15, 2006, with earlier application encouraged. Ferrellgas does not believe the adoption of SAB 108 will have a significant impact on its financial position, results of operations and cash flows.

(5) Reclassifications:

Ferrellgas reclassified $45.8 million of customer deposits and advances from accounts payable to other current liabilities in its July 31, 2006 condensed consolidated balance sheet to conform this amount to the current period presentation. Certain other reclassifications have been made to the prior year condensed consolidated financial statements to conform them to the current year presentation.

C.		Unit and stock-based compensation

		Ferrellgas recognizes the non-cash compensation charges resulting from all share-based payment transactions in the condensed consolidated statements of earnings as follows:


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Operating expense	$	153	$	106	$	300	$	358
General and administrative expense		346		240		865		1,223

	$	499	$	346	$	1,165	$	1,581

Ferrellgas Partners Unit Option Plan (“UOP”)

There have been no awards granted pursuant to the UOP since fiscal 2001. During the three and nine months ended April 30, 2007, no compensation charge relating to the UOP was recognized as all options currently outstanding are fully vested. During the three and nine months ended April 30, 2006, the portion of the total non-cash compensation charge relating to the UOP was $0.1 million and $0.3 million, respectively. A summary of option activity under the UOP as of April 30, 2007 is presented below:


						Weighted-
						average
				Weighted		remaining
				average		contractual		Aggregate
	Number of			exercise		term		intrinsic value
	Units			price		(in years)		(in thousands)

Outstanding, August 1, 2006		148,200		$	18.43
Exercised		(50,000	)		18.05
Forfeited		(9,650	)		20.37

Outstanding, April 30, 2007		88,550			18.43		2.87	$	448


Options exercisable, April 30, 2007		88,550			18.43		2.87	$	448

Ferrell Companies, Inc. Incentive Compensation Plan (“ICP”)

The ICP is not a Ferrellgas stock-compensation plan. However, in accordance with Ferrellgas’ partnership agreements, all employee-related costs incurred by Ferrell Companies are allocated to Ferrellgas. As a result, Ferrellgas incurs a non-cash compensation charge from Ferrell Companies as they account for their plan in accordance with SFAS 123(R). During the three months ended April 30, 2007 and 2006, the portion of the total non-cash compensation charge relating to the ICP was $0.5 million and $0.2 million, respectively. During the nine months ended April 30, 2007 and 2006, the portion of the total non-cash compensation charge relating to the ICP was $1.2 million and $1.3 million, respectively.

D.		Business combinations

		Business combinations are accounted for under the purchase method 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 condensed consolidated statements of earnings from the date of acquisition. The pro forma effect of these transactions was not material to Ferrellgas’ results of operations.

		During the nine months ended April 30, 2007, Ferrellgas acquired propane distribution assets with an aggregate value of $35.5 million in eight transactions.

		These acquisitions were funded by $31.1 million in cash payments, the issuances of $2.4 million of liabilities and other costs and considerations, and $2.0 million of common units, net of issuance costs.

		The aggregate fair values of these eight transactions were allocated as follows:


Customer tanks, buildings and land	$	11,404
Non-compete agreements		2,051
Customer lists		17,784
Goodwill		3,499
Working capital		712

	$	35,450

During the nine months ended April 30, 2007, Ferrellgas issued $0.6 million of common units to satisfy liabilities related to prior year acquisitions.

The estimated fair values and useful lives of assets acquired are based on a preliminary internal 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.

E.		Accounts receivable securitization

		The operating partnership transfers certain of its trade accounts receivable to Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), a wholly-owned unconsolidated, special purpose entity, and retains an interest in a portion of these transferred receivables. As these transferred receivables are subsequently collected and the funding from the accounts receivable securitization facility is reduced, the operating partnership’s retained interest in these receivables is reduced. The accounts receivable securitization facility consisted of the following:


	April 30,		July 31,
	2007		2006
Retained interest	$	24,594	$	16,373
Accounts receivable transferred	$	132,500	$	87,500

The retained interest was classified as accounts and notes receivable on the condensed consolidated balance sheets. The operating partnership had the ability to transfer, at its option, an additional $5.0 million of its trade accounts receivable at April 30, 2007.

Other accounts receivable securitization disclosures consist of the following items:


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Net non-cash activity	$	992	$	761	$	2,573	$	2,191
Bad debt expense	$	—	$	259	$	202	$	525

The net non-cash activity reported in the condensed consolidated statements of earnings approximates the financing cost of issuing commercial paper backed by these accounts receivable plus an allowance for doubtful accounts associated with the outstanding receivables transferred to Ferrellgas Receivables. The weighted average discount rate used to value the retained interest in the transferred receivables was 5.3% and 6.0% as of April 30, 2007 and July 31, 2006, respectively.

F.		Supplemental financial statement information

		Inventories consist of:


	April 30,		July 31,
	2007		2006
Propane gas and related products	$	74,269	$	130,644
Appliances, parts and supplies		24,415		23,969

	$	98,684	$	154,613

In addition to inventories on hand, Ferrellgas enters into contracts primarily to buy propane for supply procurement purposes. Most of these contracts have terms of less than one year and call for payment based on market prices at the date of delivery. All fixed price contracts have terms of fewer than 24 months. As of April 30, 2007, Ferrellgas had committed, for supply procurement purposes, to make net delivery of approximately 13.1 million gallons of propane at fixed prices.

Loss on disposal of assets and other consist of:


	For the three months						For the nine months
	ended April 30,						ended April 30,
	2007			2006			2007			2006
Loss on disposal of assets	$	1,471		$	1,334		$	3,935		$	303
Loss on transfer of accounts receivable related to the accounts receivable securitization		2,915			2,787			8,699			8,171
Service income related to the accounts receivable securitization		(1,289	)		(1,240	)		(3,042	)		(2,956	)

	$	3,097		$	2,881		$	9,592		$	5,518

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


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Operating expense	$	44,913	$	35,031	$	122,308	$	114,498
Depreciation and amortization expense		1,282		1,389		4,008		4,348
Equipment lease expense		6,003		5,867		17,661		18,390

	$	52,198	$	42,287	$	143,977	$	137,236

Other current liabilities consist of:


	April 30,		July 31,
	2007		2006
Accrued interest	$	25,393	$	24,800
Accrued payroll		18,615		18,724
Current portion of long-term debt		2,426		14,758
Customer deposits and advances		17,428		45,837
Other		38,464		36,619

	$	102,326	$	140,738

G.		Long-term debt

		Long-term debt consists of:


	April 30,		July 31,
	2007		2006
Senior notes
Fixed rate, Series C-E, ranging from 7.12% to 7.42% due 2008-2013	$	204,000	$	241,000
Fixed rate, 8.75%, due 2012, net of unamortized premium		269,943		270,229
Fixed rate, Series B-C, ranging from 8.78% to 8.87%, due 2007-2009		163,000		184,000
Fixed rate, 6.75% due 2014, net of unamortized discount		249,368		249,300

Credit agreement, variable interest rates, expiring 2010		110,694		45,453

Notes payable, due 2007 to 2016, net of unamortized discount		9,177		8,238

Capital lease obligations		55		83

		1,006,237		998,303

Less: current portion, included in other current liabilities on the condensed consolidated balance sheets		2,426		14,758

	$	1,003,811	$	983,545

On August 1, 2006, Ferrellgas made scheduled principal payments of $37.0 million of the 7.08% Series B senior notes and $21.0 million of the 8.68% Series A senior notes using proceeds from borrowings on the unsecured bank credit facility. On August 29, 2006, Ferrellgas used $46.1 million of proceeds from the issuance of common units, including unit option exercises, and general partner contributions to retire a portion of the $58.0 million borrowed under the unsecured bank credit facility.

On August 18, 2006, the operating partnership executed a Commitment Increase Agreement to its Fifth Amended and Restated Credit Agreement dated April 22, 2005, increasing the borrowing capacity available under the unsecured bank credit facility from $365.0 million to $375.0 million. As of April 30, 2007, Ferrellgas had total borrowings outstanding under the unsecured bank credit facility of $143.7 million. Ferrellgas classified $33.0 million of this amount as short term borrowings since it was used to fund working capital needs that management intends to pay down within the next 12 months. These borrowings have a weighted average interest rate of 7.48%. As of July 31, 2006, Ferrellgas had total borrowings outstanding under the unsecured bank credit facility of $98.1 million. Ferrellgas classified $52.6 million of this amount as short term borrowings since it was used to fund working capital needs that management had intended to pay down within the following 12 months. These borrowings had a weighted average interest rate of 7.67%.

H.		Partners’ capital

		Common unit issuances

		On August 29, 2006, Ferrellgas received proceeds of $44.1 million, net of issuance costs, from the issuance of 1.9 million common units to Ferrell Companies pursuant to Ferrellgas’ Direct Investment Plan. Ferrellgas used the net proceeds to reduce borrowings outstanding under the unsecured bank credit facility.

		Partnership distributions

		Ferrellgas Partners has paid the following distributions:


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Public common unit holders	$	19,165	$	18,905	$	57,392	$	56,561
Ferrell Companies (1)		10,040		9,094		30,121		27,283
FCI Trading Corp. (2)		98		98		294		294
Ferrell Propane, Inc. (3)		26		26		77		77
James E. Ferrell (4)		2,146		2,116		6,438		6,318
General partner		318		305		953		914


	$	31,793	$	30,544	$	95,275	$	91,447


(1)		Ferrell Companies is the owner of the general partner and a 32% owner of Ferrellgas’ common units and thus a related party.

(2)		FCI Trading Corp. (“FCI Trading”) is an affiliate of the general partner and thus a related party.

(3)		Ferrell Propane, Inc. (“Ferrell Propane”) is controlled by the general partner and thus a related party.

(4)		James E. Ferrell (“Mr. Ferrell”) is the Chairman and Chief Executive Officer of the general partner and thus a related party.

On March 16, 2007, December 15, 2006 and September 14, 2006, Ferrellgas Partners paid cash distributions of $0.50 per common unit for each of the three months ended January 31, 2007, October 31 and July 31, 2006, respectively. On May 22, 2007, Ferrellgas Partners declared a cash distribution of $0.50 per common unit for the three months ended April 30, 2007, which is expected to be paid on June 14, 2007. Included in this cash distribution are the following amounts expected to be paid to related parties:


Ferrell Companies	$	10,040
FCI Trading Corp.		98
Ferrell Propane, Inc.		26
James E. Ferrell		2,146
General partner		318

I.		Contingencies

		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. As a result, at any given time, Ferrellgas is threatened with or named as a defendant in various lawsuits arising in the ordinary course of business. Currently, 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 condensed consolidated financial condition, results of operations and cash flows of Ferrellgas.

J.		Earnings per common unit

		Below is a calculation of the basic and diluted earnings per common unit in the condensed consolidated statements of earnings for the periods indicated. In accordance with EITF 03-6, “Participating Securities and the Two-Class Method under FASB Statement No. 128,Earnings per Share” (“EITF 03-6”), Ferrellgas calculates net earnings per limited partner unit for each period presented according to distributions declared and participation rights in undistributed earnings, as if all of the earnings for the period had been distributed. 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. Although the dilutive effect of EITF 03-6 on basic net earnings per common unit was $0.03 for the three months ended April 30, 2007, due to the seasonality of the propane business, the dilutive effect of EITF 03-6 typically impacts only the three months ending January 31. There was not a dilutive effect of EITF 03-6 on basic net earnings per limited partner unit for the three months ended April 30, 2006 and the nine months ended April 30, 2007 and 2006.

		In periods with year-to-date 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. Ferrellgas typically incurs net losses in the three month period ended October 31.


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Net earnings available to common unitholders	$	41,843	$	30,632	$	72,645	$	62,605

(in thousands)

Weighted average common units outstanding		62,950.4		60,483.8		62,688.2		60,346.3

Dilutive securities		17.9		32.1		17.6		31.6


Weighted average common units outstanding plus dilutive securities		62,968.3		60,515.9		62,705.8		60,377.9


Basic and diluted earnings per common unit available to common unitholders	$	0.66	$	0.51	$	1.16	$	1.04

K.		Transactions with related parties

		Reimbursable costs

		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 condensed consolidated statements of earnings as follows:


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Operating expense	$	53,144	$	52,795	$	155,046	$	155,791
General and administrative expense		6,147		5,467		19,053		16,921

Operations

Ferrell International Limited (“Ferrell International”) is beneficially owned by Mr. Ferrell and thus is an affiliate. During the nine months ended April 30, 2006, Ferrellgas provided limited accounting services for Ferrell International and recognized $30 thousand of receipts for providing these services.

During February 2007, Ferrellgas made a payment of $0.3 million to the benefit of Mr. Andrew J. Filipowski pursuant to the indemnification provisions of Blue Rhino Corporation’s former bylaws and the Agreement and Plan of Merger with Blue Rhino Corporation. Mr. Filipowski is the brother-in-law of Mr. Billy D. Prim (“Mr. Prim”), who is a member of the general partner’s Board of Directors.

During April 2007, a payment of $1.0 million was made to Mr. Prim in accordance with the employment agreement entered into between Mr. Prim and Ferrellgas’ general partner for his employment as Special Advisor to the Chief Executive Officer, which ended in February 2007. Mr. Prim continues to serve on the general partner’s Board of Directors.

L.		Subsequent events

		During May 2007, the operating partnership entered into a new unsecured bank credit facility with additional borrowing capacity of up to $150.0 million which matures on August 1, 2009.

		During May 2007, the operating partnership renewed its accounts receivable securitization facility for a 364-day commitment with JP Morgan Chase Bank, N.A. and Fifth Third Bank. The renewed facility allows the operating partnership to sell up to $160.0 million of accounts receivable, depending on the available undivided interest in the operating partnership’s accounts receivable from certain customers.

FERRELLGAS PARTNERS FINANCE CORP.
(A wholly-owned subsidiary of Ferrellgas Partners, L.P.)

CONDENSED BALANCE SHEETS
(in dollars)
(unaudited)


	April 30,			July 31,
	2007			2006
ASSETS

Cash	$	1,000		$	1,000

Total assets	$	1,000		$	1,000


STOCKHOLDER’S EQUITY

Common stock, $1 par value; 2,000 shares authorized; 1,000 shares issued and outstanding	$	1,000		$	1,000

Additional paid in capital		3,818			3,713

Accumulated deficit		(3,818	)		(3,713	)

Total stockholder’s equity	$	1,000		$	1,000

CONDENSED STATEMENTS OF EARNINGS
(in dollars)
(unaudited)


	For the three months ended					For the nine months ended
	April 30,					April 30,
	2007			2006		2007			2006
General and administrative expense	$	60		$	—	$	105		$	105

Net loss	$	(60	)	$	—	$	(105	)	$	(105	)

See note to condensed financial statements.

FERRELLGAS PARTNERS FINANCE CORP.
(A wholly-owned subsidiary of Ferrellgas Partners, L.P.)

CONDENSED STATEMENTS OF CASH FLOWS
(in dollars)
(unaudited)


	For the nine months ended
	April 30,
	2007			2006
Cash flows from operating activities:
Net loss	$	(105	)	$	(105	)

Cash used in operating activities		(105	)		(105	)


Cash flows from financing activities:
Capital contribution		105			105

Cash provided by financing activities		105			105


Change in cash		—			—
Cash – beginning of period		1,000			1,000

Cash – end of period	$	1,000		$	1,000

See note to condensed financial statements.

NOTE TO CONDENSED FINANCIAL STATEMENTS
APRIL 30, 2007
(unaudited)

		A.Organization

		Ferrellgas Partners Finance Corp. (the “Finance Corp.”), a Delaware corporation, was formed on March 28, 1996, and is a wholly-owned subsidiary of Ferrellgas Partners, L.P (the “Partnership”).

		The condensed financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of the interim periods presented. All adjustments to the condensed financial statements were of a normal, recurring nature.

		The Finance Corp. has nominal assets, does not conduct any operations, has no employees and serves as co-obligor for debt securities of the Partnership.

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)


	April 30,		July 31,
	2007		2006
ASSETS

Current assets:
Cash and cash equivalents	$	23,689	$	14,875
Accounts and notes receivable, net		146,171		116,369
Inventories		98,684		154,613
Prepaid expenses and other current assets		18,122		14,664

Total current assets		286,666		300,521

Property, plant and equipment, net		729,490		740,101
Goodwill		249,325		246,050
Intangible assets, net		251,216		248,546
Other assets, net		15,783		8,833

Total assets	$	1,532,480	$	1,544,051


LIABILITIES AND PARTNERS’ CAPITAL

Current liabilities:
Accounts payable	$	64,250	$	82,212
Short-term borrowings		33,006		52,647
Other current liabilities		93,433		136,788

Total current liabilities		190,689		271,647

Long-term debt		733,868		713,316
Other liabilities		20,535		19,178
Contingencies and commitments (Note I)		—		—

Partners’ capital
Limited partner		574,979		533,095
General partner		5,870		5,435
Accumulated other comprehensive income		6,539		1,380

Total partners’ capital		587,388		539,910

Total liabilities and partners’ capital	$	1,532,480	$	1,544,051

See notes to condensed consolidated financial statements.

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(in thousands)
(unaudited)


	For the three months ended						For the nine months ended
	April 30,						April 30,
	2007			2006			2007			2006
Revenues:
Propane and other gas liquids sales	$	531,816		$	466,832		$	1,458,732		$	1,400,631
Other		92,346			59,194			204,616			163,561

		624,162			526,026			1,663,348			1,564,192

Costs and expenses:
Cost of product sold — propane and other gas liquids sales		341,593			288,364			956,288			919,626
Cost of product sold — other		72,118			43,319			142,039			101,788
Operating expense		97,294			95,023			287,024			281,707
Depreciation and amortization expense		22,245			21,138			65,936			63,864
General and administrative expense		11,829			12,326			32,877			34,793
Equipment lease expense		6,675			6,506			19,773			20,723
Employee stock ownership plan compensation charge		2,721			2,597			8,301			7,521
Loss on disposal of assets and other		3,097			2,881			9,592			5,518


Operating income		66,590			53,872			141,518			128,652

Interest expense		(15,608	)		(14,852	)		(48,417	)		(45,120	)
Interest income		981			557			2,871			1,465


Earnings before income taxes		51,963			39,577			95,972			84,997

Income tax expense		1,752			2,271			3,634			2,971


Net earnings	$	50,211		$	37,306		$	92,338		$	82,026

See notes to condensed consolidated financial statements.

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF PARTNERS’ CAPITAL
(in thousands)
(unaudited)


							Accumulated other
							comprehensive income (loss)
										Currency						Total
	Limited			General			Risk			translation			Pension			partners’
	partner			partner			management			adjustments			liability			capital
Balance at July 31, 2006	$	533,095		$	5,435		$	2,126		$	21		$	(767	)	$	539,910

Contributions in connection with ESOP and stock-based compensation charges		9,370			96			—			—			—			9,466

Quarterly distribution		(107,000	)		(1,092	)		—			—			—			(108,092	)

Cash contributed by Ferrellgas Partners and the general partner		46,100			470			—			—			—			46,570

Net assets contributed by Ferrellgas Partners and cash contributed by the general partner in connection with acquisitions		2,009			28			—			—			—			2,037

Comprehensive income:
Net earnings		91,405			933			—			—			—			92,338
Other comprehensive income (loss):
Net gain on risk management derivatives		—			—			7,273			—			—
Reclassification of derivatives to earnings		—			—			(2,126	)		—			—
Foreign currency translation adjustments		—			—			—			(52	)		—
Tax effect on foreign currency translation adjustments		—			—			—			(1	)		—
Pension liability adjustment		—			—			—			—			65			5,159

Comprehensive income																	97,497


Balance at April 30, 2007	$	574,979		$	5,870		$	7,273		$	(32	)	$	(702	)	$	587,388

See notes to condensed consolidated financial statements.

FERRELLGAS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)


	For the nine months
	ended April 30,
	2007			2006
Cash flows from operating activities:
Net earnings	$	92,338		$	82,026
Reconciliation of net earnings to net cash provided by operating activities:
Depreciation and amortization expense		65,936			63,864
Employee stock ownership plan compensation charge		8,301			7,521
Stock-based compensation charge		1,165			1,581
Loss on disposal of assets		3,935			303
Loss on transfer of accounts receivable related to the accounts receivable securitization		8,699			8,171
Other		2,477			5,408
Changes in operating assets and liabilities, net of effects from business acquisitions:
Accounts and notes receivable, net of securitization		(70,083	)		(77,885	)
Inventories		56,107			(11,086	)
Prepaid expenses and other current assets		1,568			(91	)
Accounts payable		(19,481	)		11,054
Other current liabilities		(39,066	)		(19,569	)
Other liabilities		1,558			(30	)
Accounts receivable securitization:
Proceeds from new accounts receivable securitizations		100,000			102,000
Proceeds from collections reinvested in revolving period accounts receivable securitizations		971,022			976,608
Remittances of amounts collected as servicer of accounts receivable securitizations		(1,035,022	)		(1,044,608	)

Net cash provided by operating activities		149,454			105,267


Cash flows from investing activities:
Business acquisitions, net of cash acquired		(31,082	)		(13,550	)
Capital expenditures		(35,813	)		(29,207	)
Proceeds from asset sales		7,069			15,734
Other		(4,902	)		(4,207	)

Net cash used in investing activities		(64,728	)		(31,230	)


Cash flows from financing activities:
Distributions		(108,092	)		(104,519	)
Cash contributions from partners		46,570			1,554
Proceeds from increase in long-term debt		65,241			28,748
Reductions in long-term debt		(59,914	)		(1,773	)
Net (reductions) additions to short-term borrowings		(19,641	)		5,852
Cash paid for financing costs		(23	)		—

Net cash used in financing activities		(75,859	)		(70,138	)


Effect of exchange rate changes on cash		(53	)		(18	)

Increase in cash and cash equivalents		8,814			3,881
Cash and cash equivalents — beginning of period		14,875			20,191

Cash and cash equivalents — end of period	$	23,689		$	24,072

See notes to condensed consolidated financial statements.

FERRELLGAS, L.P. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
April 30, 2007
(Dollars in thousands, unless otherwise designated)
(unaudited)

A.		Partnership organization and formation

		Ferrellgas, L.P. is a limited partnership that owns and operates propane distribution and related assets. Ferrellgas Partners, L.P. (“Ferrellgas Partners”), a publicly traded limited partnership, owns an approximate 99% limited partner interest in, and consolidates, Ferrellgas, L.P. Ferrellgas, Inc. (the “general partner”), a wholly-owned subsidiary of Ferrell Companies, Inc. (“Ferrell Companies”), holds an approximate 1% general partner interest in Ferrellgas, L.P. and performs all management functions required by Ferrellgas, L.P.

		The condensed consolidated financial statements of Ferrellgas, L.P. and subsidiaries reflect all adjustments, that are, in the opinion of management, necessary for a fair statement of the interim periods presented. All adjustments to the condensed consolidated financial statements were of a normal, recurring nature. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes, as set forth in Ferrellgas, L.P.’s Annual Report on Form 10-K for fiscal 2006.

B.		Summary of significant accounting policies

(1) Nature of operations:

Ferrellgas, L.P. is engaged primarily in the distribution of propane and related equipment and supplies in the United States. The propane distribution market is seasonal because propane is used primarily for heating in residential and commercial buildings. Therefore, the results of operations for the nine months ended April 30, 2007 are not necessarily indicative of the results to be expected for a full fiscal year. Ferrellgas, L.P. serves more than one million residential, industrial/commercial, portable tank exchange, agricultural and other customers in all 50 states, the District of Columbia and Puerto Rico.

(2) Accounting estimates:

(3) Supplemental cash flow information:


	For the nine months ended
	April 30,
	2007		2006
CASH PAID FOR:
Interest	$	52,192	$	47,665
Income taxes	$	2,877	$	609
NON-CASH INVESTING ACTIVITIES:
Assets contributed from Ferrellgas Partners in connection with acquisitions	$	2,009	$	6,335
Issuance of liabilities in connection with acquisitions	$	2,331	$	1,596
Property, plant and equipment additions	$	1,519	$	1,213

(4)New accounting standards:

Statement of Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. This statement is effective for fiscal years beginning after November 15, 2007. Ferrellgas L.P. is currently evaluating the potential impact of this statement.

SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans,” requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan as either an asset or liability in the statement of financial position and to recognize changes in that funded status through other comprehensive income. This statement also requires companies to measure plan assets and benefit obligations as of the date of the company’s fiscal year-end. The recognition provisions of this statement are effective as of the end of fiscal years ending after December 15, 2006, while the measurement date provisions are effective as of the end of fiscal years ending after December 15, 2008. Ferrellgas L.P. does not believe the adoption of either provision of this statement will have a significant impact on its financial position, results of operations and cash flows.

SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities,” provides entities the irrevocable option to elect to carry most financial assets and liabilities at fair value with changes in fair value recorded in earnings. This statement is effective for fiscal years beginning after November 15, 2007. Ferrellgas, L.P. is currently evaluating the potential impact of this statement.

Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB 108”), provides guidance on the quantification of prior year misstatements. SAB 108 requires that registrants use both the income statement (roll-over) approach and the balance sheet (iron curtain) approach when evaluating the materiality of a misstatement and contains guidance for correcting the errors under this dual approach. SAB 108 is effective for fiscal years ending after November 15, 2006, with earlier application encouraged. Ferrellgas, L.P. does not believe the adoption of SAB 108 will have a significant impact on its financial position, results of operations and cash flows.

(5)Reclassifications:

Ferrellgas, L.P. reclassified $45.8 million of customer deposits and advances from accounts payable to current liabilities in its July 31, 2006 condensed consolidated balance sheet to conform this amount to the current period presentation. Certain other reclassifications have been made to the prior year condensed consolidated financial statements to conform them to the current year presentation.

C.		Unit and stock-based compensation

		Ferrellgas, L.P. has no unit or stock-based compensation plans and is not required to adopt SFAS 123(R). However, in accordance with the partnership agreements of Ferrellgas Partners and Ferrellgas, L.P., all employee-related costs incurred by Ferrellgas Partners and Ferrell Companies are allocated to Ferrellgas, L.P. Ferrellgas, L.P. recognizes a non-cash compensation charge from Ferrellgas Partners and Ferrell Companies in the condensed consolidated statements of earnings as follows:


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Operating expense	$	153	$	106	$	300	$	358
General and administrative expense		346		240		865		1,223

	$	499	$	346	$	1,165	$	1,581

Ferrellgas Partners Unit Option Plan (“UOP”)

Ferrell Companies, Inc. Incentive Compensation Plan (“ICP”)

During the three months ended April 30, 2007 and 2006, the portion of the total non-cash compensation charge relating to the ICP was $0.5 million and $0.2 million, respectively. During the nine months ended April 30, 2007 and 2006, the portion of the total non-cash compensation charge relating to the ICP was $1.2 million and $1.3 million, respectively.

D.		Business combinations

		Business combinations are accounted for under the purchase method 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 condensed consolidated statements of earnings from the date of the acquisition. The pro forma effect of these transactions was not material to Ferrellgas, L.P.’s results of operations.

		During the nine months ended April 30, 2007, Ferrellgas, L.P. acquired propane distribution assets with an aggregate value of $35.5 million in eight transactions.

		These acquisitions were funded by $31.1 million in cash payments, the contribution of net assets of $2.0 million from Ferrellgas Partners, and the issuance of $2.4 million of liabilities and other costs and other considerations.

		The aggregate fair values of these eight transactions were allocated as follows:


Customer tanks, buildings and land	$	11,404
Non-compete agreements		2,051
Customer lists		17,784
Goodwill		3,499
Working capital		712

	$	35,450

The estimated fair values and useful lives of assets acquired are based on a preliminary internal 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.

E.		Accounts receivable securitization

		Ferrellgas, L.P. transfers certain of its trade accounts receivable to Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), a wholly-owned unconsolidated, special purpose entity, and retains an interest in a portion of these transferred receivables. As these transferred receivables are subsequently collected and the funding from the accounts receivable securitization facility is reduced, Ferrellgas, L.P.’s retained interest in these receivables is reduced. The accounts receivable securitization facility consisted of the following:


	April 30,		July 31,
	2007		2006
Retained interest	$	24,594	$	16,373
Accounts receivable transferred	$	132,500	$	87,500

The retained interest was classified as accounts and notes receivable on the condensed consolidated balance sheets. Ferrellgas, L.P. had the ability to transfer, at its option, an additional $5.0 million of its trade accounts receivable at April 30, 2007.

Other accounts receivable securitization disclosures consist of the following items:


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Net non-cash activity	$	992	$	761	$	2,573	$	2,191
Bad debt expense	$	—	$	259	$	202	$	525

F.		Supplemental financial statement information

		Inventories consist of:


	April 30,		July 31,
	2007		2006
Propane gas and related products	$	74,269	$	130,644
Appliances, parts and supplies		24,415		23,969

	$	98,684	$	154,613

In addition to inventories on hand, Ferrellgas, L.P. enters into contracts primarily to buy propane for supply procurement purposes. Most of these contracts have terms of less than one year and call for payment based on market prices at the date of delivery. All fixed price contracts have terms of fewer than 24 months. As of April 30, 2007, Ferrellgas, L.P. had committed, for supply procurement purposes, to make net delivery of approximately 13.1 million gallons of propane at fixed prices.

Loss on disposal of assets and other consists of:


	For the three months						For the nine months
	ended April 30,						ended April 30,
	2007			2006			2007			2006
Loss on disposal of assets	$	1,471		$	1,334		$	3,935		$	303
Loss on transfer of accounts receivable related to the accounts receivable securitization		2,915			2,787			8,699			8,171
Service income related to the accounts receivable securitization		(1,289	)		(1,240	)		(3,042	)		(2,956	)

	$	3,097		$	2,881		$	9,592		$	5,518

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


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Operating expense	$	44,913	$	35,031	$	122,308	$	114,498
Depreciation and amortization expense		1,282		1,389		4,008		4,348
Equipment lease expense		6,003		5,867		17,661		18,390

	$	52,198	$	42,287	$	143,977	$	137,236

Other current liabilities consist of:


	April 30,		July 31,
	2007		2006
Accrued interest	$	16,534	$	21,804
Accrued payroll		18,615		18,724
Current portion of long-term debt		2,426		14,758
Customer deposits and advances		17,428		45,837
Other		38,430		35,665

	$	93,433	$	136,788

G.		Long-term debt

		Long-term debt consists of:


	April 30,		July 31,
	2007		2006
Senior notes
Fixed rate, Series C-E, ranging from 7.12% to 7.42% due 2008-2013	$	204,000	$	241,000
Fixed rate, Series B-C, ranging from 8.78% to 8.87%, due 2007-2009		163,000		184,000
Fixed rate, 6.75% due 2014, net of unamortized discount		249,368		249,300

Credit agreement, variable interest rates, expiring 2010		110,694		45,453

Notes payable, due 2007 to 2016, net of unamortized discount		9,177		8,238

Capital lease obligations		55		83

		736,294		728,074

Less: current portion, included in other current liabilities on the condensed consolidated balance sheets		2,426		14,758

	$	733,868	$	713,316

On August 1, 2006, Ferrellgas, L.P. made scheduled principal payments of $37.0 million of the 7.08% Series B and $21.0 million of the 8.68% Series A senior notes using proceeds from borrowings on the unsecured bank credit facility. On August 29, 2006, Ferrellgas, L.P. used $46.1 million of proceeds from limited partner and general partner contributions to retire a portion of the $58.0 million borrowed under the unsecured bank credit facility.

On August 18, 2006, Ferrellgas L.P. executed a Commitment Increase Agreement to its Fifth Amended and Restated Credit Agreement dated April 22, 2005 increasing the borrowing capacity available under the unsecured bank credit facility from $365.0 million to $375.0 million. As of April 30, 2007, Ferrellgas L.P. had total borrowings outstanding under the unsecured bank credit facility of $143.7 million. Ferrellgas, L.P. classified $33.0 million of this amount as short term borrowings since it was used to fund working capital needs that management intends to pay down within the next 12 months. These borrowings have a weighted average interest rate of 7.48%. As of July 31, 2006, Ferrellgas, L.P. had total borrowings outstanding under the unsecured bank credit facility of $98.1 million. Ferrellgas, L.P. classified $52.6 million of this amount as short term borrowings since it was used to fund working capital needs that management had intended to pay down within the following 12 months. These borrowings had a weighted average interest rate of 7.67%.

H.		Partners’ capital

		Partnership contributions

		On August 29, 2006, Ferrellgas, L.P. received cash contributions of $46.1 million from Ferrellgas Partners and the general partner. The proceeds were used to reduce borrowings outstanding under the unsecured bank credit facility.

		Partnership distributions

		Ferrellgas, L.P. paid to Ferrellgas Partners and the general partner distributions of $107.0 million and $1.1 million, respectively, during the nine months ended April 30, 2007. On May 22, 2007, Ferrellgas, L.P. declared distributions to Ferrellgas Partners and the general partner of $43.5 million and $0.4 million, respectively.

I.		Contingencies

		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. As a result, at any given time, Ferrellgas, L.P. is threatened with or named as a defendant in various lawsuits arising in the ordinary course of business. Currently, 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 condensed consolidated financial condition, results of operations and cash flows of Ferrellgas, L.P.

J.		Transactions with related parties

		Reimbursable costs

		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 condensed consolidated statements of earnings as follows:


	For the three months				For the nine months
	ended April 30,				ended April 30,
	2007		2006		2007		2006
Operating expense	$	53,144	$	52,795	$	155,046	$	155,791
General and administrative expense		6,147		5,467		19,053		16,921

Operations

Ferrell International Limited (“Ferrell International”) is beneficially owned by James E. Ferrell, the Chairman and Chief Executive Officer of the general partner, and thus is an affiliate. During the nine months ended April 30, 2006, Ferrellgas, L.P. provided limited accounting services for Ferrell International and recognized $30 thousand of receipts for providing these services.

During February 2007, Ferrellgas, L.P. made a payment of $0.3 million to the benefit of Mr. Andrew J. Filipowski pursuant to the indemnification provisions of Blue Rhino Corporation’s former bylaws and the Agreement and Plan of Merger with Blue Rhino Corporation. Mr. Filipowski is the brother-in-law of Mr. Billy D. Prim (“Mr. Prim”), who is a member of the general partner’s Board of Directors.

During April 2007, a payment of $1.0 million was made to Mr. Prim in accordance with the employment agreement entered into between Mr. Prim and Ferrellgas’ general partner for his employment as Special Advisor to the Chief Executive Officer which ended in February 2007. Mr. Prim continues to serve on the general partner’s Board of Directors.

Subsequent events

During May 2007, Ferrellgas, L.P. entered into a new unsecured bank credit facility with additional borrowing capacity of up to $150.0 million which matures on August 1, 2009.

During May 2007, Ferrellgas, L.P. renewed its accounts receivable securitization facility for a 364-day commitment with JP Morgan Chase Bank, N.A. and Fifth Third Bank. The renewed facility allows the operating partnership to sell up to $160.0 million of accounts receivable, depending on the available undivided interest in the operating partnership’s accounts receivable from certain customers.

FERRELLGAS FINANCE CORP.
(A wholly-owned subsidiary of Ferrellgas, L.P.)

CONDENSED BALANCE SHEETS
(in dollars)
(unaudited)


	April 30			July 31,
	2007			2006
ASSETS

Cash	$	1,000		$	1,000

Total assets	$	1,000		$	1,000


STOCKHOLDER’S EQUITY

Common stock, $1 par value; 2,000 shares authorized; 1,000 shares issued and outstanding	$	1,000		$	1,000

Additional paid in capital		1,881			1,776

Accumulated deficit		(1,881	)		(1,776	)

Total stockholder’s equity	$	1,000		$	1,000

CONDENSED STATEMENTS OF EARNINGS
(in dollars)
(unaudited)


	For the three months ended						For the nine months ended
	April 30,						April 30,
	2007			2006			2007			2006
General and administrative expense	$	105		$	105		$	105		$	105


Net loss	$	(105	)	$	(105	)	$	(105	)	$	(105	)

See note to condensed financial statements.

FERRELLGAS FINANCE CORP.
(A wholly-owned subsidiary of Ferrellgas, L.P.)

CONDENSED STATEMENTS OF CASH FLOWS
(in dollars)
(unaudited)


	For the nine months ended
	April 30,
	2007			2006
Cash flows from operating activities:
Net loss	$	(105	)	$	(105	)

Cash used in operating activities		(105	)		(105	)


Cash flows from financing activities:
Capital contribution		105			105

Cash provided by financing activities		105			105


Change in cash		—			—
Cash – beginning of period		1,000			1,000

Cash – end of period	$	1,000		$	1,000

See note to condensed financial statements.

NOTE TO CONDENSED FINANCIAL STATEMENTS
APRIL 30, 2007
(unaudited)

		A. Organization

		Ferrellgas Finance Corp. (the “Finance Corp.”), a Delaware corporation, was formed on January 16, 2003 and is a wholly-owned subsidiary of Ferrellgas, L.P (the “Partnership”).

		The condensed financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of the interim periods presented. All adjustments to the condensed financial statements were of a normal, recurring nature.

		The Finance Corp. has nominal assets, does not conduct any operations, has no employees and serves as co-obligor for debt securities of the Partnership.


ITEM 2.		MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Our management’s discussion and analysis of financial condition and results of operations relates to Ferrellgas Partners, L.P. and Ferrellgas, L.P.

Ferrellgas Partners Finance Corp. and Ferrellgas Finance Corp. have nominal assets, do not conduct any operations and have no employees. Ferrellgas Partners Finance Corp. serves as co-obligor for debt securities of Ferrellgas Partners and Ferrellgas Finance Corp. serves as co-obligor for debt securities of Ferrellgas, L.P. Accordingly, and due to the reduced disclosure format, a discussion of the results of operations, liquidity and capital resources of Ferrellgas Partners Finance Corp. and Ferrellgas Finance Corp. is not presented in this section.

In this Quarterly Report on Form 10-Q, unless the context indicates otherwise:

	•		“us,” “we,” “our,” or “ours” are references exclusively to Ferrellgas Partners, L.P. together with its consolidated subsidiaries, including Ferrellgas Partners Finance Corp., Ferrellgas, L.P. and Ferrellgas Finance Corp., except when used in connection with “common units” in which case these terms refer to Ferrellgas Partners, L.P. without its consolidated subsidiaries;

	•		“Ferrellgas Partners” refers to Ferrellgas Partners, L.P. itself, without its consolidated subsidiaries;

	•		the “operating partnership” refers to Ferrellgas, L.P., together with its consolidated subsidiaries, including Ferrellgas Finance Corp.;

	•		our “general partner” refers to Ferrellgas, Inc.;

	•		“Ferrell Companies” refers to Ferrell Companies, Inc., the sole shareholder of our general partner;

	•		“unitholders” refers to holders of common units of Ferrellgas Partners;

	•		“customers” refers to customers other than our wholesale customers or our other bulk propane distributors and marketers;

	•		“propane sales volumes” refers to the volume of propane sold to our customers and excludes any volumes of propane sold to our wholesale customers and other bulk propane distributors or marketers; and

	•		“Notes” refers to the notes to the condensed consolidated financial statements of Ferrellgas Partners or the operating partnership, as applicable.

Ferrellgas Partners is a holding entity that conducts no operations and has two direct subsidiaries, Ferrellgas Partners Finance Corp. and the operating partnership. Ferrellgas Partners’ only significant assets are its approximate 99% limited partnership interest in the operating partnership and its 100% equity interest in Ferrellgas Partners Finance Corp. The common units of Ferrellgas Partners are listed on the New York Stock Exchange and our activities are substantially conducted through the operating partnership.

The operating partnership was formed on April 22, 1994, and accounts for substantially all of our consolidated assets, sales and operating earnings, except for interest expense related to $268.0 million in the aggregate principal amount of 8 3/4% senior notes due 2012 co-issued by Ferrellgas Partners and Ferrellgas Partners Finance Corp.

Our general partner performs all management functions for us and our subsidiaries and holds a 1% general partner interest in Ferrellgas Partners and an approximate 1% general partner interest in the operating partnership. The parent company of our general partner, Ferrell Companies, beneficially owns approximately 32% of our outstanding common units. Ferrell Companies is owned 100% by an employee stock ownership trust.

We file annual, quarterly, and other reports and other information with the SEC. You may read and download our SEC filings over the internet from several commercial document retrieval services as well

as at the SEC’s website at www.sec.gov. You may also read and copy our SEC filings at the SEC’s public reference room at, 100 F Street N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information concerning the public reference room and any applicable copy charges. Because our common units are traded on the New York Stock Exchange, we also provide our SEC filings and particular other information to the New York Stock Exchange. You may obtain copies of these filings and this other information at the offices of the New York Stock Exchange at 11 Wall Street, New York, New York 10005. In addition, our SEC filings are available on our website at www.ferrellgas.com at no cost as soon as reasonably practicable after our electronic filing or furnishing thereof with the SEC. Please note that any internet addresses provided in this Quarterly Report on Form 10-Q are for informational purposes only and are not intended to be hyperlinks. Accordingly, no information found and/or provided at such internet addresses is intended or deemed to be incorporated by reference herein.

Overview

We are a leading distributor of propane and related equipment and supplies to customers primarily in the United States. We believe that we are the second largest retail marketer of propane in the United States, including the largest national provider of propane by portable tank exchange as measured by our propane sales volumes in fiscal 2006. We serve more than one million residential, industrial/commercial, propane tank exchange, agricultural and other customers in all 50 states, the District of Columbia and Puerto Rico. Our operations primarily include the distribution and sale of propane and related equipment and supplies with concentrations in the Midwest, Southeast, Southwest and Northwest regions of the country.

The market for propane is seasonal because of increased demand during the winter months primarily for the purpose of providing heating in residential and commercial buildings. Consequently, sales and operating profits are concentrated in our second and third fiscal quarters, which are during the winter heating season of November through March. However, the propane by portable tank exchanges sales volume provides us increased operating profits during our first and fourth fiscal quarters due to its counter-seasonal business activities. It also provides us the ability to better utilize our seasonal resources at our retail distribution locations. Other factors affecting our results of operations include competitive conditions, energy commodity prices, demand for propane, timing of acquisitions and general economic conditions in the United States.

We use information on temperatures to understand how our results of operations are affected by temperatures that are warmer or colder than normal. We use the definition of “normal” temperatures based on information published by the National Oceanic and Atmospheric Administration (“NOAA”). Based on this information, we calculate a ratio of actual heating degree days to normal heating degree days. Heating degree days are a general indicator of weather impacting propane usage.

Weather conditions have a significant impact on demand for propane for heating purposes during the winter heating season of November through March. Accordingly, the volume of propane used by our customers for this purpose is directly affected by the severity of the winter weather in the regions we serve and can vary substantially from year to year. In any given region, sustained warmer-than-normal temperatures will tend to result in reduced propane use, while sustained colder-than-normal temperatures will tend to result in greater use.

Our gross margin from the distribution of propane is primarily based on the cents-per-gallon difference between our costs to purchase and distribute propane and the sale prices we charge our customers. Our residential customers and portable tank exchange customers typically provide us a greater cents-per-gallon margin than our industrial/commercial, agricultural and other customers. The wholesale propane price per gallon is subject to various market conditions and may fluctuate based on changes in demand, supply and other energy commodity prices, primarily crude oil and natural gas as propane prices tend to correlate with the fluctuations of these underlying commodities. We employ risk management activities that attempt to mitigate risks related to the purchasing and transporting of propane.

We continue to pursue the following business strategies:

	•		capitalize on our national presence and economies of scale;

	•		expand our operations through disciplined acquisitions and internal growth; and

	•		align employee interests with our investors through significant employee ownership.

Forward-looking statements

Statements included in this report include forward-looking statements. These forward-looking statements are identified as any statement that does not relate strictly to historical or current facts. These statements often use words such as “anticipate,” “believe,” “intend,” “plan,” “projection,” “forecast,” “strategy,” “position,” “continue,” “estimate,” “expect,” “may,” “will” or the negative of those terms or other variations of them or comparable terminology. These statements often discuss plans, strategies, events or developments that we expect or anticipate will or may occur in the future and are based upon the beliefs and assumptions of our management and on the information currently available to them. In particular, statements, express or implied, concerning future operating results, or our ability to generate sales, income or cash flow are forward-looking statements.

Forward-looking statements are not guarantees of performance. You should not put undue reliance on any forward-looking statements. All forward-looking statements are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially from those expressed in or implied by these forward-looking statements. Many of the factors that will affect our future results are beyond our ability to control or predict.

Some of our forward-looking statements include the following:

	•		whether the operating partnership will have sufficient funds to meet its obligations, including its obligations under its debt securities, and to enable it to distribute to Ferrellgas Partners sufficient funds to permit Ferrellgas Partners to meet its obligations with respect to its existing debt and equity securities;

	•		whether Ferrellgas Partners and the operating partnership will continue to meet all of the quarterly financial tests required by the agreements governing their indebtedness; and

	•		the expectation that revenues — propane and other gas liquids sales, cost of product sold – propane and other gas liquids sales will increase, while operating loss and net loss will decrease during the fourth quarter of fiscal 2007 as compared to the same period during fiscal 2006.

These forward-looking statements can also be found in the section of our Annual Report on Form 10-K for our fiscal 2006 entitled “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.” When considering any forward-looking statement, you should also keep in mind the risk factors set forth in the section of our Annual Report on Form 10-K for our fiscal 2006 entitled “Item 1A. Risk Factors.” Any of these risks could impair our business, financial condition or results of operations. Any such impairment may affect our ability to make distributions to our unitholders or pay interest on the principal of any of our debt securities. In addition, the trading price, if any, of our securities could decline as a result of any such impairment.

Except for our ongoing obligations to disclose material information as required by federal securities laws, we undertake no obligation to update any forward-looking statements or risk factors after the date of this quarterly report.

The following is a discussion of our historical financial condition and results of operations and should be read in conjunction with our historical condensed consolidated financial statements and accompanying notes thereto included elsewhere in this Quarterly Report on Form 10-Q.

The discussions set forth in the “Results of Operations” and “Liquidity and Capital Resources”

sections generally refer to Ferrellgas Partners and its consolidated subsidiaries. However, in these discussions there exists two material differences between Ferrellgas Partners and the operating partnership. Those two material differences are:

	•		because Ferrellgas Partners issued $268.0 million in aggregate principal amount of 8 3/4% senior secured notes due fiscal 2012 during fiscal 2004 and 2003, the two partnerships incur different amounts of interest expense on their outstanding indebtedness; see the statements of earnings in their respective condensed consolidated financial statements; and

	•		Ferrellgas Partners issued common units in several transactions during fiscal 2006 and 2007.

Results of Operations

Three months ended April 30, 2007 compared to April 30, 2006


					Favorable
(amounts in thousands)					(unfavorable)
Three months ended April 30,	2007		2006		variance
Propane sales volumes (gallons)		244,407		231,186		13,221		6	%

Propane and other gas liquids sales	$	531,816	$	466,832	$	64,984		14	%
Gross margin from propane and other gas liquids sales (a)		190,223		178,468		11,755		7	%
Operating income		66,515		53,810		12,705		24	%
Interest expense		21,534		20,778		(756	)	(4	)%


(a)		Gross margin from propane and other gas liquids sales represents Propane and other gas liquids sales less Cost of product sold – propane and other gas liquids sales.

Propane sales volume during the three months ended April 30, 2007 increased 13.2 million gallons compared to the prior year period. This increase in sales volume was primarily due to weather during the three months ended April 30, 2007 being 6% colder than the three months ended April 30, 2006, as well as gallons gained through acquisitions completed during the last 12 months. We believe this increase in gallons sold was partially offset by customer conservation. The wholesale market price of propane has increased 9% since the prior year period and has increased 25% since the third quarter of fiscal 2005. The wholesale market price at one of the major supply points, Mt. Belvieu, Texas averaged $1.04 and $0.95 per gallon during the three months ended April 30, 2007 and 2006, respectively, compared to an average price of $0.83 per gallon during the three months ended April 30, 2005.

Propane and other gas liquids sales increased $65.0 million compared to the prior year period. Approximately $23.7 million of this increase was due to an increase in lower-margin wholesale sales, $18.6 million was due to colder weather as discussed above, $18.0 million was due to the effect of increased sales price per gallon and $7.8 million related to acquisitions completed during the last 12 months. We believe these increases were partially offset by customer conservation compared to the prior year period.

Gross margin from propane and other gas liquids sales increased $11.8 million compared to the prior year period. Approximately $7.1 million of this increase was due to colder weather as discussed above, $3.5 million was due to acquisitions completed during the last 12 months and $3.0 million due to improved margins per gallon. We believe these increases were partially offset by customer conservation compared to the prior year period.

Operating income increased $12.7 million compared to the prior year period primarily due to the previously mentioned gross margin from propane and other gas liquids sales which increased $11.8 million and margins

related to other revenue which increased $4.4 million. These increases were partially offset by an increase in operating expense of $2.3 million. Margins related to other revenue increased primarily due to increased margins on propane appliances and equipment sales. Operating expense increased primarily due to acquisitions completed during the last 12 months and internal growth.

Interest expense increased $0.8 million primarily due to increased borrowings on our unsecured bank credit facility primarily to fund acquisition and growth capital expenditures, partially offset by retirement of a portion of our fixed rate senior notes during the first quarter of fiscal 2007.

Interest expense of the operating partnership

Nine months ended April 30, 2007 compared to April 30, 2006


					Favorable
(amounts in thousands)					(unfavorable)
Nine months ended April 30,	2007		2006		Variance
Propane sales volumes (gallons)		681,567		681,885		(318	)	—	%

Propane and other gas liquids sales	$	1,458,732	$	1,400,631		$58,101		4	%
Gross margin from propane and other gas liquids sales (a)		502,444		481,005		21,439		4	%
Operating income		141,318		128,465		12,853		10	%
Interest expense		66,243		62,893		(3,350	)	(5	)%


(a)		Gross margin from propane and other gas liquids sales represents Propane and other gas liquids sales less Cost of product sold – propane and other gas liquids sales.

Propane sales volume during the nine months ended April 30, 2007 were consistent with the prior year period. Weather during the nine months ended April 30, 2007 was 7% colder than the prior year period. This colder weather combined with gallons gained through acquisitions completed during the last 12 months increased propane sales volumes, which we believe were offset by customer conservation. Although the wholesale market price of propane has remained consistent since the prior year nine month average period, the wholesale market price has increased 22% since the third quarter nine month average of fiscal 2005. The wholesale market price at one of the major supply points, Mt. Belvieu, Texas averaged $1.00 and $1.01 per gallon during the nine months ended April 30, 2007 and 2006, respectively, compared to an average price of $0.82 per gallon during the nine months ended April 30, 2005.

Propane and other gas liquids sales increased $58.1 million compared to the prior year period. Approximately $55.9 million of this increase was due to colder weather as discussed above, $45.2 million was due to the effect of increased sales price per gallon, $19.7 million was due to acquisitions completed during the last 12 months and a $12.2 million increase in lower-margin wholesale sales and other third-parties. We believe these increases were partially offset by customer conservation as discussed above.

Gross margin from propane and other gas liquids sales increased $21.4 million compared to the prior year period. Approximately $24.9 million of this increase was due to improved margins per gallon, $19.6 million of this increase was due to colder weather discussed above, and $8.6 million due to acquisitions completed during the last 12 months. We believe these increases were partially offset by customer conservation as discussed above.

Operating income increased $12.9 million compared to the prior year period primarily due to the previously mentioned gross margin from

propane and other gas liquids sales which increased $21.4 million. This increase in operating income was partially offset by a $5.3 million increase in operating expense and a $4.1 million increase in loss on disposal of assets and other. Operating expense increased primarily due to acquisitions completed during the last 12 months and internal growth. Loss on disposal of assets and other increased primarily due to a gain on the sale of non-strategic assets in the prior year period that was not repeated in the current year period.

Interest expense increased $3.4 million primarily due to increased borrowings on our unsecured bank credit facility primarily to fund acquisition and growth capital expenditures, partially offset by retirement of a portion of our fixed rate senior notes during the first quarter of fiscal 2007.

Interest expense of the operating partnership

Interest expense increased $3.3 million primarily due to increased borrowings on our unsecured bank credit facility primarily to fund acquisition and growth capital expenditures, partially offset by retirement of a portion of our fixed rate senior notes during the first quarter of fiscal 2007.

Forward-looking statements

We expect increases during the remainder of fiscal 2007 for revenue — propane and other gas liquids sales, cost of product sold – propane and other gas liquids sales and reductions in operating loss and net loss in the fourth fiscal quarter of fiscal 2007 as compared to the same period during fiscal 2006.

Liquidity and Capital Resources

General

Our cash requirements include working capital requirements, debt service payments, the minimum quarterly common unit distribution, acquisition and capital expenditures. The minimum quarterly distribution of $0.50 expected to be paid on June 14, 2007 to all common units that were outstanding on June 7, 2007, represents the fifty-first consecutive minimum quarterly distribution paid to our common unitholders dating back to October 1994. Our working capital requirements are subject to, among other things, the price of propane, delays in the collection of receivables, volatility in energy commodity prices, liquidity imposed by insurance providers, downgrades in our credit ratings, decreased trade credit, significant acquisitions, the weather and other changes in the demand for propane. Relatively colder weather or higher propane prices during the winter heating season are factors that could significantly increase our working capital requirements.

Our ability to satisfy our obligations is dependent upon our future performance, which will be subject to prevailing economic, financial, business, weather conditions and other factors, many of which are beyond our control. Due to the seasonality of the retail propane distribution business, a significant portion of our cash flow from operations is generated during the winter heating season, which occurs during our second and third fiscal quarters. Our net cash provided by operating activities primarily reflects earnings from our business activities adjusted for depreciation and amortization and changes in our working capital accounts. Historically, we generate significantly lower net cash from operating activities in our first and fourth fiscal quarters as compared to the second and third fiscal quarters because fixed costs generally exceed revenues and related costs and expenses during the non-peak heating season. Subject to meeting the financial tests discussed below, our general partner believes that the operating partnership will have sufficient funds available to meet its obligations, and to distribute to Ferrellgas Partners sufficient funds to permit Ferrellgas Partners to meet its obligations for the remainder of fiscal 2007 and in fiscal 2008. In addition, our general partner believes that the operating partnership will have sufficient funds available to distribute to Ferrellgas Partners sufficient cash to pay the minimum quarterly distribution on all of its common units for the remainder of fiscal 2007 and in fiscal 2008.

Our bank credit facility, public debt, private debt and accounts receivable securitization facility contain several financial tests and covenants restricting our ability to pay distributions, incur debt and

engage in certain other business transactions. In general, these tests are based on our debt-to-cash flow ratio and cash flow-to-interest expense ratio. Our general partner currently believes that the most restrictive of these tests are debt incurrence limitations under the terms of our bank credit and accounts receivable securitization facilities and limitations on the payment of distributions within our 8 3/4% senior notes due 2012. The bank credit and accounts receivable securitization facilities generally limit the operating partnership’s ability to incur debt if it exceeds prescribed ratios of either debt to cash flow or cash flow to interest expense. Our 8 3/4% senior notes restrict payments if a minimum ratio of cash flow to interest expense is not met, assuming certain exceptions to this ratio limit have previously been exhausted. This restriction places limitations on our ability to make restricted payments such as the payment of cash distributions to our unitholders. The cash flow used to determine these financial tests generally is based upon our most recent cash flow performance giving pro forma effect for acquisitions and divestitures made during the test period. Our bank credit facility, public debt, private debt and accounts receivable securitization facility do not contain early repayment provisions related to a potential decline in our credit rating.

As of April 30, 2007, we met all the required quarterly financial tests and covenants. Based upon current estimates of our cash flow, our general partner believes that we will be able to continue to meet all of the required quarterly financial tests and covenants for the remainder of fiscal 2007 and in fiscal 2008. However, we may not meet the applicable financial tests in future quarters if we were to experience:

	•		significantly warmer than normal winter temperatures;

	•		a continued volatile energy commodity cost environment;

	•		an unexpected downturn in business operations; or

	•		a general economic downturn in the United States.

This failure could have a materially adverse effect on our operating capacity and cash flows and could restrict our ability to incur debt or to make cash distributions to our unitholders, even if sufficient funds were available. Depending on the circumstances, we may consider alternatives to permit the incurrence of debt or the continued payment of the quarterly cash distribution to our unitholders. No assurances can be given, however, that such alternatives can or will be implemented with respect to any given quarter.

We expect our future capital expenditures, working capital and debt service needs to be provided by a combination of cash generated from future operations, existing cash balances, our bank credit facilities or our accounts receivable securitization facility. See additional information about our accounts receivable securitization facility in “Operating Activities – Accounts receivable securitization.” In order to reduce existing indebtedness, fund future acquisitions and expansive capital projects, we may obtain funds from our facilities, we may issue additional debt to the extent permitted under existing financing arrangements or we may issue additional equity securities, including, among others, common units.

Toward this purpose, the following registration statements were effective upon filing or declared effective by the SEC:

	•		a shelf registration statement for the periodic sale of common units, debt securities and/or other securities. Ferrellgas Partners Finance Corp. may, at our election, be the co-obligor on any debt securities issued by Ferrellgas Partners under this shelf registration statement;

	•		an “acquisition” shelf registration statement for the periodic sale of up to $250.0 million of common units to fund acquisitions. As of May 31, 2007 we had $240.0 million available under this shelf agreement; and

	•		a shelf registration statement for the periodic sale of up to $200.0 million of common units in connection with the Ferrellgas Partners’ direct purchase and distribution reinvestment plan. As of May 31, 2007 we had $200.0 million available under this shelf agreement.

Operating Activities

Net cash provided by operating activities was $137.3 million for the nine months ended April 30, 2007, compared to net cash provided by operating activities of $93.3 million for the prior year period. This increase in cash provided by operating activities was primarily due to a $26.5 million improvement in working capital, a $13.9 million increase in cash flow from operations and a $2.0 million increase in cash flow from the utilization of our accounts receivable securitization facility. The improvement in working capital was primarily due to the timing of inventory purchases and collections on accounts receivable, which was partially offset by the timing of accounts payable disbursements, and decreases in customer deposits and advances. The increase in cash flow from operations was primarily due to improved results of operations as discussed above.

Accounts receivable securitization

Cash flows from our accounts receivable securitization facility increased $2.0 million. We received net funding of $36.0 million from this facility during the nine months ended April 30, 2007 as compared to $34.0 million in the prior year period.

Our strategy for obtaining liquidity at the lowest cost of capital is to initially utilize the accounts receivable securitization facility before borrowing under the operating partnership’s bank credit facilities. See additional discussion about the operating partnership’s bank credit facility in “Financing Activities – Bank credit facility.” Our utilization of the accounts receivable securitization facility is limited by the amount of accounts receivable that we are permitted to transfer according to the facility agreement. This arrangement allows for the proceeds of up to $160.0 million from the sale of accounts receivable, depending on the available undivided interests in our accounts receivable from certain customers. We renewed this facility effective May 31, 2007, for a 364-day commitment with JPMorgan Chase Bank, N.A. and Fifth Third Bank. At April 30, 2007, we had transferred $132.5 million of our trade accounts receivable with the ability to transfer, at our option, an additional $5.0 million to the accounts receivable securitization facility. As our trade accounts receivable increase during the winter heating season, the securitization facility permits us to transfer additional trade accounts receivable to the facility, thereby providing additional cash for working capital needs. This transaction is reflected in our condensed consolidated financial statements as a sale of accounts receivable and a retained interest in transferred accounts receivable.

The operating partnership

Net cash provided by operating activities was $149.5 million for the nine months ended April 30, 2007, compared to net cash provided by operating activities of $105.3 million for the prior year period This increase in cash provided by operating activities was primarily due to a $26.6 million improvement in working capital, a $14.0 million increase in cash flows from operations and $2.0 million increase in cash flow from the utilization of our accounts receivable securitization facility. The improvement in working capital was primarily due to the timing of inventory purchases and collections on accounts receivable, which was partially offset by the timing of accounts payable disbursements, and decreases in customer deposits and advances. The increase in cash flow from operations was primarily due to improved results of operations as discussed above.

Investing Activities

During the nine months ended April 30, 2007, net cash used in investing activities was $64.7 million, compared to $31.2 million used in investing activities for the prior year period. This increase in cash used in investing activities is primarily due to increased acquisition activity and capital expenditures.

Capital expenditures

We incurred cash capital expenditures of $35.8 million during the nine months ended April 30, 2007 as compared to $29.2 million in the prior year period primarily due to increased growth and maintenance expenditures.

Acquisition

During the nine months ended April 30, 2007, we used $31.1 million in cash for the acquisition of eight propane businesses as compared to $13.5 million in cash in the prior year period.

Financing Activities

During the nine months ended April 30, 2007, net cash used in financing activities was $65.2 million compared to net cash used in financing activities of $57.9 million for the prior year period. This increase in cash used in financing activities was primarily due to cash outflows related to net reductions of long-term debt and short-term borrowings which were partially offset by increased cash inflows from the issuance of common units.

Common unit issuance

During the first quarter of fiscal 2007, we received proceeds of $44.2 million, net of issuance costs, from the issuance of 1.9 million common units to Ferrell Companies pursuant to Ferrellgas Partners’ Direct Investment Plan and general partner contributions. We used the net proceeds to reduce borrowings on our unsecured bank credit facility.

Distributions

Ferrellgas Partners paid a $0.50 per unit quarterly distribution on all common units, as well as the related general partner distributions, totaling $95.3 million during the nine months ended April 30, 2007 in connection with the distributions declared for the three months ended July 31 and October 31, 2006 and January 31, 2007. The quarterly distribution on all common units and the related general partner distributions for the three months ended April 30, 2007 of $31.8 million are expected to be paid on June 14, 2007 to holders of record on June 7, 2007.

Bank credit facilities

During August 2006, we executed a Commitment Increase Agreement to our existing unsecured bank credit facility, increasing the borrowing capacity from $365.0 million to $375.0 million.

At April 30, 2007, $143.7 million of borrowings and $50.2 million of letters of credit were outstanding under our existing unsecured bank credit facility, which will mature on April 22, 2010. Letters of credit are currently used to cover obligations primarily relating to requirements for insurance coverage and, to a lesser extent, risk management activities and product purchases. At April 30, 2007, we had $181.1 million available for working capital, acquisition, capital expenditure and general partnership purposes under this unsecured bank credit facility.

During May 2007, we entered into a new unsecured bank credit facility with additional borrowing capacity of up to $150.0 million which matures on August 1, 2009. During May 2007 $45.0 million was borrowed on this facility to paydown borrowings outstanding on the existing unsecured credit facility.

All borrowings under our unsecured bank credit facilities bear interest, at our option, at a rate equal to either:

•		a base rate, which is defined as the higher of the federal funds rate plus 0.50% or Bank of America’s prime rate (as of April 30, 2007, the federal funds rate and Bank of America’s prime rate were 5.29% and 8.25%, respectively); or

•		the Eurodollar Rate plus a margin varying from 1.50% to 2.50% (as of April 30, 2007, the one-month and three-month Eurodollar Rates were 5.32% and 5.35%, respectively).

In addition, an annual commitment fee is payable on the daily unused portion of our unsecured bank credit facilities at a per annum rate varying from 0.375% to 0.500% (as of April 30, 2007, the commitment fee per annum rate was 0.375%).

We believe that the liquidity available from our unsecured bank credit facilities and the accounts receivable securitization facility will be sufficient to meet our future capital expenditures, working capital, debt service and letter of credit requirements for the remainder of fiscal 2007 and all of fiscal 2008. See “Operating Activities” for discussion about our accounts receivable securitization facility. However, if we were to experience an unexpected significant increase in these requirements, our needs could exceed our immediately available resources. Events that could cause increases in these requirements include, but are not limited to the following:

•		a significant increase in the wholesale cost of propane;

•		a significant delay in the collections of accounts receivable;

•		increased volatility in energy commodity prices related to risk management activities;

•		increased liquidity requirements imposed by insurance providers;

•		a significant downgrade in our credit rating;

•		decreased trade credit; or

•		a significant acquisition.

If one or more of these or other events caused a significant use of available funding, we may consider alternatives to provide increased liquidity and capital funding. No assurances can be given, however, that such alternatives would be available, or, if available, could be implemented.

The operating partnership

The financing activities discussed above also apply to the operating partnership except for cash flows related to distributions, as discussed below.

Distributions

The operating partnership paid cash distributions of $108.1 million during the nine months ended April 30, 2007. The operating partnership expects to pay cash distributions of $44.0 million on June 14, 2007.

Disclosures about Effects of Transactions with Related Parties

We have no employees and are managed and controlled by our general partner. Pursuant to our partnership agreement, our general partner is entitled to reimbursement for all direct and indirect expenses incurred or payments it makes on our behalf, and all other necessary or appropriate expenses allocable to us or otherwise reasonably incurred by our general partner in connection with operating our business. These reimbursable costs, which totaled $174.1 million for the nine months ended April 30, 2007, include operating expenses such as compensation and benefits paid to employees of our general partner who perform services on our behalf, as well as related general and administrative expenses.

Related party common unitholder information consisted of the following:


			Distributions paid
	Common unit		during the nine
	ownership at		months ended April
	April 30, 2007		30, 2007
Ferrell Companies (1)		20,080.8	$	30,121
FCI Trading Corp. (2)		195.7		294
Ferrell Propane, Inc. (3)		51.2		77
James E. Ferrell (4)		4,292.0		6,438


(1)		Ferrell Companies is the sole shareholder of our general partner.

(2)		FCI Trading Corp. is an affiliate of the general partner and is wholly-owned by Ferrell Companies.

(3)		Ferrell Propane, Inc. is wholly-owned by our general partner.

(4)		James E. Ferrell (“Mr. Ferrell”) is the Chairman and Chief Executive Officer of our general partner.

During the nine months ended April 30, 2007, Ferrellgas Partners paid our general partner distributions of $1.0 million.

On August 29, 2006, we received proceeds of $44.1 million, net of issuance costs, from the issuance of 1.9 million common units to Ferrell Companies pursuant to Ferrellgas’ Direct Investment Plan. We used the net proceeds to reduce borrowings outstanding under our unsecured bank credit facility.

During February 2007, we made a payment of $0.3 million to the benefit of Mr. Andrew J. Filipowski pursuant to the indemnification provisions of Blue Rhino Corporation’s former bylaws and the Agreement and Plan of Merger with Blue Rhino Corporation. Mr. Filipowski is the brother-in-law of Mr. Billy D. Prim, who is a member of our general partner’s board of directors.

During April 2007, a payment of $1.0 million was made to Mr. Prim in accordance with the employment agreement entered into between Mr. Prim and our general partner for his employment as Special Advisor to the Chief Executive Officer which ended in February 2007. Mr. Prim continues to serve on our general partner’s Board of Directors.

Ferrell International Limited (“Ferrell International”) is beneficially owned by Mr. Ferrell and thus is an affiliate. During the prior year period, we provided limited accounting services to Ferrell International. During the three and nine months ended April 30, 2007, we recognized no net receipts from providing limited accounting services.

See “Financing Activities” for additional information regarding transactions with related parties.

We believe these related party transactions were under terms that were no less favorable to us than those available with third parties.

We have had no material changes in our contractual obligations that were outside the ordinary course of business since our disclosure in our Annual Report on Form 10-K for our fiscal 2006.

See Note B – Summary of significant accounting policies – in our condensed consolidated financial statements for discussion regarding the adoption of new accounting standards in the current fiscal year.

We have had no other material changes to our critical accounting policies and estimates since our disclosure in our Annual Report on Form 10-K for our fiscal 2006.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our risk management trading activities include the use of energy commodity forward contracts, swaps and options traded on the over-the-counter financial markets and futures and options traded on the New York Mercantile Exchange. These risk management activities are conducted primarily to offset the effect of market price fluctuations on propane inventory and purchase commitments and to mitigate the price risk on sale commitments to our customers.

Our risk management trading activities are intended to generate a profit, which we then apply to reduce our cost of product sold. The results of our risk management activities directly related to the delivery of propane to our customers, which include our supply procurement, storage and transportation activities, are presented in our discussion of margins and are accounted for at cost. The results, if any, of our other risk management activities are presented separately in our discussion of gross margin found in

“Management’s Discussion and Analysis of Financial Condition and Results of Operations – Results of Operations” as risk management trading activities and are accounted for at fair value.

Market risks associated with energy commodities are monitored daily by senior management for compliance with our commodity risk management policy. This policy includes an aggregate dollar loss limit and limits on the term of various contracts. We also utilize volume limits for various energy commodities and review our positions daily where we remain exposed to market risk, so as to manage exposures to changing market prices.

We did not enter into any significant risk management trading activities during the nine months ended April 30, 2007. Our remaining market risk sensitive instruments and positions have been determined to be “other than trading”.

Commodity Price Risk

Our risk management activities primarily attempt to mitigate risks related to the purchasing, storing and transporting of propane. We generally purchase propane in the contract and spot markets from major domestic energy companies on a short-term basis. Our costs to purchase and distribute propane fluctuate with the movement of market prices. This fluctuation subjects us to potential price risk, which we attempt to minimize through the use of risk management activities.

Our risk management activities include the use of forward contracts, futures, swaps and options to seek protection from adverse price movements and to minimize potential losses. Our hedging strategy involves taking positions in the forward or financial markets that are equal and opposite to our positions in the physical product markets in order to minimize the risk of financial loss from an adverse price change. Our hedging strategy is successful when our gains or losses in the physical product markets are offset by our losses or gains in the forward or financial markets.

We have prepared a sensitivity analysis to estimate the exposure to market risk of our energy commodity positions. Forward contracts, futures, swaps and options outstanding as of April 30, 2007 and July 31, 2006, that were used in our risk management activities were analyzed assuming a hypothetical 10% adverse change in prices for the delivery month for all energy commodities. The potential loss in future earnings from these positions due to a 10% adverse movement in market prices of the underlying energy commodities was estimated at $1.5 million and $5.7 million as of April 30, 2007 and July 31, 2006, respectively. The preceding hypothetical analysis is limited because changes in prices may or may not equal 10%, thus actual results may differ.

Our sensitivity analysis includes designated hedging and the anticipated transactions associated with these hedging transactions. These hedging transactions are anticipated to be 100% effective; therefore, there is no effect on our sensitivity analysis from these hedging transactions. To the extent option contracts are used as hedging instruments for anticipated transactions we have included the offsetting effect of the anticipated transactions, only to the extent the option contracts are in the money, or would become in the money as a result of the 10% hypothetical movement in prices. All other anticipated transactions for risk management activities have been excluded from our sensitivity analysis.

Interest Rate Risk

At April 30, 2007 and July, 31, 2006, we had $143.7 million and $98.1 million, respectively, in variable rate bank credit facility borrowings. Thus, assuming a one percent increase in our variable interest rate, our interest rate risk related to the borrowings on our variable rate bank credit facility would result in a loss in future earnings of $1.4 million for the twelve months ending April 30, 2007. The preceding hypothetical analysis is limited because changes in interest rates may or may not equal one percent, thus actual results may differ.

ITEM 4. CONTROLS AND PROCEDURES

An evaluation was performed by the management of Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., Ferrellgas, L.P., and Ferrellgas Finance Corp., with the participation of the principal executive officer and principal financial officer of our general partner, of the effectiveness of our disclosure controls and procedures. Based on that evaluation, our management, including our principal executive officer and principal financial officer, concluded that our disclosure controls and procedures, as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act, were designed to be and were adequate and effective as of April 30, 2007.

The management of Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., Ferrellgas, L.P., and Ferrellgas Finance Corp. does not expect that our disclosure controls and procedures will prevent all errors and all fraud. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Based on the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Partnership have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events. Therefore, a control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Our disclosure controls and procedures are designed to provide such reasonable assurances of achieving our desired control objectives, and the principal executive officer and principal financial officer of our general partner have concluded, as of April 30, 2007, that our disclosure controls and procedures are effective in achieving that level of reasonable assurance.

During the most recent fiscal quarter ended April 30, 2007, there have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) or Rule 15d-15(f) of the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Our 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. As a result, at any given time, we are threatened with or named as a defendant in various lawsuits arising in the ordinary course of business. Currently, we are 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 our financial condition, results of operations and cash flows.

ITEM 1A. RISK FACTORS

There have been no material changes from the risk factors as previously disclosed in our Annual Report on Form 10-K for our fiscal 2006.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

The exhibits listed below are furnished as part of this Quarterly Report on Form 10-Q. Exhibits required by Item 601 of Regulation S-K of the Securities Act, which are not listed, are not applicable.


Exhibit
Number		Description
	2.1	Contribution Agreement dated February 8, 2004, by and among FCI Trading Corp., Ferrellgas, Inc., Ferrellgas Partners, L.P. and Ferrellgas, L.P. Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K filed February 12, 2004.

	3.1	Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P., dated as of February 18, 2003. Incorporated by reference to Exhibit 4.3 to our Current Report on Form 8-K filed February 18, 2003.

	3.2	First Amendment to the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P., dated as of March 8, 2003. Incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed March 8, 2005.

	3.3	Second Amendment to the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P., dated as of June 29, 2005. Incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed June 30, 2005.

	3.4	Third Amendment to the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P. dated as of October 11, 2006. Incorporated by reference to Exhibit 3.4 to our Annual Report on Form 10-K filed October 12, 2006.

	3.5	Certificate of Incorporation for Ferrellgas Partners Finance Corp. Incorporated by reference to the same numbered Exhibit to our Quarterly Report on Form 10-Q filed June 13, 1997.

	3.6	Bylaws of Ferrellgas Partners Finance Corp. Incorporated by reference to the same numbered Exhibit to our Quarterly Report on Form 10-Q filed June 13, 1997.

	3.7	Third Amended and Restated Agreement of Limited Partnership of Ferrellgas, L.P., dated as of April 7, 2004. Incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed April 22, 2004.

	3.8	Certificate of Incorporation of Ferrellgas Finance Corp. Incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K of Ferrellgas Partners, L.P. filed February 18, 2003.

	3.9	Bylaws of Ferrellgas Finance Corp. Incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K of Ferrellgas Partners, L.P. filed February 18, 2003.

	4.1	Specimen Certificate evidencing Common Units representing Limited Partner Interests (contained in Exhibit 3.1 hereto as Exhibit A thereto).


Exhibit
Number		Description
	4.2	Indenture dated as of September 24, 2002, with form of Note attached, among Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., and U.S. Bank National Association, as trustee, relating to 8 3/4% Senior Notes due 2012. Incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed September 24, 2002.

	4.3	Indenture dated as of April 20, 2004, with form of Note attached, among Ferrellgas Escrow LLC and Ferrellgas Finance Escrow Corporation and U.S. Bank National Association, as trustee, relating to 6³/4% Senior Notes due 2014. Incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed April 22, 2004.

	4.4	Ferrellgas, L.P. Note Purchase Agreement, dated as of July 1, 1998, relating to:
		$109,000,000 6.99% Senior Notes, Series A, due August 1, 2005, $37,000,000 7.08% Senior Notes, Series B, due August 1, 2006, $52,000,000 7.12% Senior Notes, Series C, due August 1, 2008, $82,000,000 7.24% Senior Notes, Series D, due August 1, 2010, and $70,000,000 7.42% Senior Notes, Series E, due August 1, 2013. Incorporated by reference to Exhibit 4.4 to our Annual Report on Form 10-K filed October 29, 1998.

	4.5	Ferrellgas, L.P. Note Purchase Agreement, dated as of February 28, 2000, relating to: $21,000,000 8.68% Senior Notes, Series A, due August 1, 2006, $90,000,000 8.78% Senior Notes, Series B, due August 1, 2007, and $73,000,000 8.87% Senior Notes, Series C, due August 1, 2009. Incorporated by reference to Exhibit 4.2 to our Quarterly Report on Form 10-Q filed March 16, 2000.

	4.6	Registration Rights Agreement dated as of December 17, 1999, by and between Ferrellgas Partners, L.P. and Williams Natural Gas Liquids, Inc. Incorporated by reference to Exhibit 4.2 to our Current Report on Form 8-K filed December 29, 2000.

	4.7	First Amendment to the Registration Rights Agreement dated as of March 14, 2000, by and between Ferrellgas Partners, L.P. and Williams Natural Gas Liquids, Inc. Incorporated by reference to Exhibit 4.1 to our Quarterly Report on Form 10-Q filed March 16, 2000.

	4.8	Second Amendment to the Registration Rights Agreement dated as of April 6, 2001, by and between Ferrellgas Partners, L.P. and The Williams Companies, Inc. Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K filed April 6, 2001.

	4.9	Third Amendment to the Registration Rights Agreement dated as of June 29, 2005, between JEF Capital Management, Inc. and Ferrellgas Partners, L.P. Incorporated by reference to Exhibit 10.1 to our Current Report of Form 8-K filed June 30, 2005.


Exhibit
Number		Description
	10.1	Fifth Amended and Restated Credit Agreement dated as of April 22, 2005, by and among Ferrellgas, L.P. as the borrower, Ferrellgas, Inc. as the general partner of the borrower, Bank of America N.A., as administrative agent and swing line lender, and the lenders and L/C issuers party hereto. Incorporated by reference to Exhibit 10.5 to our Quarterly Report on Form 10-Q filed June 8, 2005.

	10.2	Credit Agreement dated as of May 1, 2007, by and among Ferrellgas, L.P. as the borrower, Ferrellgas, Inc. as the general partner of the borrower, Bank of America N.A., as administrative agent. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed May 4, 2007.

	10.3	Lender Addendum dated as of June 6, 2006, by and among Deutsche Bank Trust Company Americas as the new lender, Ferrellgas, L.P. as the borrower, Ferrellgas, Inc. and Bank of America, N.A., as Administrative Agent. Incorporated by reference to Exhibit 10.2 to our Annual Report on Form 10-K filed October 12, 2006.

	10.4	Commitment Increase Agreement dated as of August 28, 2006, by and among Fifth Third Bank as the lender, Ferrellgas, L.P. as the borrower, Ferrellgas, Inc. and Bank of America, N.A. as Administrative Agent. Incorporated by reference to Exhibit 10.3 to our Annual Report on Form 10-K filed October 12, 2006.

	10.5	Amended and Restated Receivable Interest Sale Agreement dated June 7, 2005 between Ferrellgas, L.P., as originator, and Ferrellgas Receivables, L.L.C., as buyer. Incorporated by reference to Exhibit 10.9 to our Quarterly Report on Form 10-Q filed June 8, 2005.

	10.6	Amendment No. 1 to the Amended and Restated Receivable Interest Sale Agreement and Subordinated Note dated June 6, 2006 between Ferrellgas, L.P., as originator, and Ferrellgas Receivables, LLC, as buyer. Incorporated by reference to Exhibit 10.11 to our Quarterly Report on Form 10-Q filed on June 8, 2006.

	10.7	Amendment No. 2 to the Amended and Restated Receivable Interest Sale Agreement dated June 6, 2006 between Ferrellgas, L.P., as originator, and Ferrellgas Receivables, LLC, as buyer. Incorporated by reference to Exhibit 10.6 to our Annual Report on Form 10-K filed October 12, 2006.

	10.8	Amendment No. 3 to the Amended and Restated Receivable Interest Sale Agreement dated May 31, 2007 between Ferrellgas, L.P., as originator, and Ferrellgas Receivables, LLC, as buyer. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K Filed June 1, 2007.

	10.9	Second Amended and Restated Receivables Purchase Agreement dated as of June 6, 2006, by and among Ferrellgas Receivables, L.L.C., as seller, Ferrellgas, L.P., as servicer, Jupiter Securitization Corporation, the financial institutions from time to time party hereto, Fifth Third Bank and JPMorgan Chase Bank, NA, as agent. Incorporated by reference to Exhibit 10.19 to our Quarterly Report on Form 10-Q filed June 8, 2006.


	Exhibit
	Number		Description
		10.10	Amendment No. 1 to Second Amended and Restated Receivables Purchase Agreement dated August 18, 2006, by and among Ferrellgas Receivables, LLC, as seller, Ferrellgas, L.P., as servicer, Jupiter Securitization Corporation, the financial institutions from time to time party hereto, Fifth Third Bank and JPMorgan Chase Bank, NA, as agent. Incorporated by reference to Exhibit 99.2 to our Current Report on Form 8-K filed August 18, 2006.

		10.11	Amendment No. 2 to Second Amended and Restated Receivables Purchase Agreement dated May 31, 2007, by and among Ferrellgas Receivables, LLC, as seller, Ferrellgas, L.P., as servicer, Jupiter Securitization Corporation, the financial institutions from time to time party hereto, Fifth Third Bank and JPMorgan Chase Bank, NA, as agent. Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K filed June 1, 2007.

		10.12	Agreement and Plan of Merger dated as of February 8, 2004, by and among Blue Rhino Corporation, FCI Trading Corp., Diesel Acquisition, LLC and Ferrell Companies, Inc. Incorporated by reference to Exhibit 99.2 to our Current Report on Form 8-K filed February 13, 2004.

		10.13	First Amendment to the Agreement and Plan of Merger dated as of March 16, 2004, by and among Blue Rhino Corporation, FCI Trading Corp., Diesel Acquisition, LLC, and Ferrell Companies, Inc. Incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K filed April 2, 2004.

		10.14	Asset Purchase Agreement dated as of June 22, 2005 by and among Ferrellgas, L.P., Ferrellgas, Inc. and Enterprise Products Operating L.P. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on June 23, 2005.

		10.15	Real Property Contribution Agreement dated February 8, 2004, between Ferrellgas Partners, L.P. and Billy D. Prim. Incorporated by reference to Exhibit 10.15 to our Quarterly Report on Form 10-Q filed June 14, 2004.

		10.16	Unit Purchase Agreement dated February 8, 2004, between Ferrellgas Partners, L.P. and Billy D. Prim. Incorporated by reference to Exhibit 4.5 to our Form S-3 filed May 21, 2004.

		10.17	Unit Purchase Agreement dated February 8, 2004, between Ferrellgas Partners, L.P. and James E. Ferrell. Incorporated by reference to Exhibit 99.3 to our Current Report on Form 8-K filed February 12, 2004.

#		10.18	Ferrell Companies, Inc. Supplemental Savings Plan, restated January 1, 2000. Incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K filed February 18, 2003.

#		10.19	Second Amended and Restated Ferrellgas Unit Option Plan. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed June 5, 2001.

#		10.20	Ferrell Companies, Inc. 1998 Incentive Compensation Plan, as amended and restated effective October 11, 2004. Incorporated by reference to Exhibit 10.23 to our Annual Report on Form 10-K filed October 13, 2004.


	Exhibit
	Number		Description
#		10.21	Employment Agreement between James E. Ferrell and Ferrellgas, Inc., dated July 31, 1998. Incorporated by reference to Exhibit 10.13 to our Annual Report on Form 10-K filed October 29, 1998.

#		10.22	Waiver to Employment, Confidentiality, and Non-Compete Agreement by and among Ferrell Companies, Inc., Ferrellgas, Inc., James E. Ferrell and Greatbanc Trust Company, dated as of December 19, 2006. Incorporated by reference to Exhibit 10.19 to our Quarterly Report on Form 10-Q filed March 9, 2007.

#		10.23	Amended and Restated Employment Agreement dated October 11, 2004, by and among Ferrellgas, Inc., Ferrell Companies, Inc. and Billy D. Prim. Incorporated by reference to Exhibit 10.25 to our Annual Report on Form 10-K filed October 13, 2004.

#		10.24	Separation Agreement and Release dated March 9, 2006 between Timothy E. Scronce and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.28 to our Quarterly Report on Form 10-Q filed March 10, 2006.

#		10.25	Agreement and Release dated as of May 11, 2006 by and among Jeffrey B. Ward, Ferrellgas, Inc., Ferrell Companies, Inc., Ferrellgas Partners, L.P. and Ferrellgas, L.P. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed June 22, 2006.

#		10.26	Agreement and Release dated as of August 15, 2006 by and among Kenneth A. Heinz, Ferrellgas, Inc., Ferrell Companies, Inc., Ferrellgas Partners, L.P. and Ferrellgas, L.P. Incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K filed August 18, 2006.

#		10.27	Change In Control Agreement dated as of October 9, 2006 by and between Stephen L. Wambold and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.23 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.28	Change In Control Agreement dated as of October 9, 2006 by and between Eugene D. Caresia and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.24 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.29	Change In Control Agreement dated as of October 9, 2006 by and between Kevin T. Kelly and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.26 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.30	Change In Control Agreement dated as of October 9, 2006 by and between Brian J. Kline and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.27 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.31	Change In Control Agreement dated as of October 9, 2006 by and between George L. Koloroutis and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.28 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.32	Change In Control Agreement dated as of October 9, 2006 by and between Patrick J. Walsh and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.29 to our Annual Report on Form 10-K filed October 12, 2006.


	Exhibit
	Number		Description
#		10.33	Change In Control Agreement dated as of October 9, 2006 by and between James E. Ferrell and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.30 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.34	Change In Control Agreement dated as of October 9, 2006 by and between Tod D. Brown and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.31 to our Annual Report on Form 10-K filed October 12, 2006.

*		31.1	Certification of Ferrellgas Partners, L.P. pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.

*		31.2	Certification of Ferrellgas Partners Finance Corp. pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.

*		31.3	Certification of Ferrellgas, L.P. pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.

*		31.4	Certification of Ferrellgas Finance Corp. pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.

*		32.1	Certification of Ferrellgas Partners, L.P. pursuant to 18 U.S.C. Section 1350.

*		32.2	Certification of Ferrellgas Partners Finance Corp. pursuant to 18 U.S.C. Section 1350.

*		32.3	Certification of Ferrellgas, L.P. pursuant to 18 U.S.C. Section 1350.

*		32.4	Certification of Ferrellgas Finance Corp. pursuant to 18 U.S.C. Section 1350.


*		Filed herewith

#		Management contracts or compensatory plans.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	FERRELLGAS PARTNERS, L.P. By Ferrellgas, Inc. (General Partner)
Date: June 7, 2007	By	/s/ Kevin T. Kelly
		Kevin T. Kelly
		Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)


	FERRELLGAS PARTNERS FINANCE CORP.
Date: June 7, 2007	By	/s/ Kevin T. Kelly
		Kevin T. Kelly
		Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)


	FERRELLGAS, L.P. By Ferrellgas, Inc. (General Partner)
Date: June 7, 2007	By	/s/ Kevin T. Kelly
		Kevin T. Kelly
		Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)


	FERRELLGAS FINANCE CORP.
Date: June 7, 2007	By	/s/ Kevin T. Kelly
		Kevin T. Kelly
		Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)

Index to Exhibits


Exhibit
Number		Description
	2.1	Contribution Agreement dated February 8, 2004, by and among FCI Trading Corp., Ferrellgas, Inc., Ferrellgas Partners, L.P. and Ferrellgas, L.P. Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K filed February 12, 2004.

	3.1	Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P., dated as of February 18, 2003. Incorporated by reference to Exhibit 4.3 to our Current Report on Form 8-K filed February 18, 2003.

	3.2	First Amendment to the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P., dated as of March 8, 2003. Incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed March 8, 2005.

	3.3	Second Amendment to the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P., dated as of June 29, 2005. Incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed June 30, 2005.

	3.4	Third Amendment to the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P. dated as of October 11, 2006. Incorporated by reference to Exhibit 3.4 to our Annual Report on Form 10-K filed October 12, 2006.

	3.5	Certificate of Incorporation for Ferrellgas Partners Finance Corp. Incorporated by reference to the same numbered Exhibit to our Quarterly Report on Form 10-Q filed June 13, 1997.

	3.6	Bylaws of Ferrellgas Partners Finance Corp. Incorporated by reference to the same numbered Exhibit to our Quarterly Report on Form 10-Q filed June 13, 1997.

	3.7	Third Amended and Restated Agreement of Limited Partnership of Ferrellgas, L.P., dated as of April 7, 2004. Incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed April 22, 2004.

	3.8	Certificate of Incorporation of Ferrellgas Finance Corp. Incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K of Ferrellgas Partners, L.P. filed February 18, 2003.

	3.9	Bylaws of Ferrellgas Finance Corp. Incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K of Ferrellgas Partners, L.P. filed February 18, 2003.

	4.1	Specimen Certificate evidencing Common Units representing Limited Partner Interests (contained in Exhibit 3.1 hereto as Exhibit A thereto).


Exhibit
Number		Description
	4.2	Indenture dated as of September 24, 2002, with form of Note attached, among Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., and U.S. Bank National Association, as trustee, relating to 8 3/4% Senior Notes due 2012. Incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed September 24, 2002.

	4.3	Indenture dated as of April 20, 2004, with form of Note attached, among Ferrellgas Escrow LLC and Ferrellgas Finance Escrow Corporation and U.S. Bank National Association, as trustee, relating to 6³/4% Senior Notes due 2014. Incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed April 22, 2004.

	4.4	Ferrellgas, L.P. Note Purchase Agreement, dated as of July 1, 1998, relating to:
		$109,000,000 6.99% Senior Notes, Series A, due August 1, 2005, $37,000,000 7.08% Senior Notes, Series B, due August 1, 2006, $52,000,000 7.12% Senior Notes, Series C, due August 1, 2008, $82,000,000 7.24% Senior Notes, Series D, due August 1, 2010, and $70,000,000 7.42% Senior Notes, Series E, due August 1, 2013. Incorporated by reference to Exhibit 4.4 to our Annual Report on Form 10-K filed October 29, 1998.

	4.5	Ferrellgas, L.P. Note Purchase Agreement, dated as of February 28, 2000, relating to: $21,000,000 8.68% Senior Notes, Series A, due August 1, 2006, $90,000,000 8.78% Senior Notes, Series B, due August 1, 2007, and $73,000,000 8.87% Senior Notes, Series C, due August 1, 2009. Incorporated by reference to Exhibit 4.2 to our Quarterly Report on Form 10-Q filed March 16, 2000.

	4.6	Registration Rights Agreement dated as of December 17, 1999, by and between Ferrellgas Partners, L.P. and Williams Natural Gas Liquids, Inc. Incorporated by reference to Exhibit 4.2 to our Current Report on Form 8-K filed December 29, 2000.

	4.7	First Amendment to the Registration Rights Agreement dated as of March 14, 2000, by and between Ferrellgas Partners, L.P. and Williams Natural Gas Liquids, Inc. Incorporated by reference to Exhibit 4.1 to our Quarterly Report on Form 10-Q filed March 16, 2000.

	4.8	Second Amendment to the Registration Rights Agreement dated as of April 6, 2001, by and between Ferrellgas Partners, L.P. and The Williams Companies, Inc. Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K filed April 6, 2001.
	4.9	Third Amendment to the Registration Rights Agreement dated as of June 29, 2005, between JEF Capital Management, Inc. and Ferrellgas Partners, L.P. Incorporated by reference to Exhibit 10.1 to our Current Report of Form 8-K filed June 30, 2005.


Exhibit
Number		Description
	10.1	Fifth Amended and Restated Credit Agreement dated as of April 22, 2005, by and among Ferrellgas, L.P. as the borrower, Ferrellgas, Inc. as the general partner of the borrower, Bank of America N.A., as administrative agent and swing line lender, and the lenders and L/C issuers party hereto. Incorporated by reference to Exhibit 10.5 to our Quarterly Report on Form 10-Q filed June 8, 2005.

	10.2	Credit Agreement dated as of May 1, 2007, by and among Ferrellgas, L.P. as the borrower, Ferrellgas, Inc. as the general partner of the borrower, Bank of America N.A., as administrative agent. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed May 4, 2007.

	10.3	Lender Addendum dated as of June 6, 2006, by and among Deutsche Bank Trust Company Americas as the new lender, Ferrellgas, L.P. as the borrower, Ferrellgas, Inc. and Bank of America, N.A., as Administrative Agent. Incorporated by reference to Exhibit 10.2 to our Annual Report on Form 10-K filed October 12, 2006.

	10.4	Commitment Increase Agreement dated as of August 28, 2006, by and among Fifth Third Bank as the lender, Ferrellgas, L.P. as the borrower, Ferrellgas, Inc. and Bank of America, N.A. as Administrative Agent. Incorporated by reference to Exhibit 10.3 to our Annual Report on Form 10-K filed October 12, 2006.

	10.5	Amended and Restated Receivable Interest Sale Agreement dated June 7, 2005 between Ferrellgas, L.P., as originator, and Ferrellgas Receivables, L.L.C., as buyer. Incorporated by reference to Exhibit 10.9 to our Quarterly Report on Form 10-Q filed June 8, 2005.

	10.6	Amendment No. 1 to the Amended and Restated Receivable Interest Sale Agreement and Subordinated Note dated June 6, 2006 between Ferrellgas, L.P., as originator, and Ferrellgas Receivables, LLC, as buyer. Incorporated by reference to Exhibit 10.11 to our Quarterly Report on Form 10-Q filed on June 8, 2006.

	10.7	Amendment No. 2 to the Amended and Restated Receivable Interest Sale Agreement dated June 6, 2006 between Ferrellgas, L.P., as originator, and Ferrellgas Receivables, LLC, as buyer. Incorporated by reference to Exhibit 10.6 to our Annual Report on Form 10-K filed October 12, 2006.

	10.8	Amendment No. 3 to the Amended and Restated Receivable Interest Sale Agreement dated May 31, 2007 between Ferrellgas, L.P., as originator, and Ferrellgas Receivables, LLC, as buyer. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K Filed June 1, 2007.
	10.9	Second Amended and Restated Receivables Purchase Agreement dated as of June 6, 2006, by and among Ferrellgas Receivables, L.L.C., as seller, Ferrellgas, L.P., as servicer, Jupiter Securitization Corporation, the financial institutions from time to time party hereto, Fifth Third Bank and JPMorgan Chase Bank, NA, as agent. Incorporated by reference to Exhibit 10.19 to our Quarterly Report on Form 10-Q filed June 8, 2006.


	Exhibit
	Number		Description
		10.10	Amendment No. 1 to Second Amended and Restated Receivables Purchase Agreement dated August 18, 2006, by and among Ferrellgas Receivables, LLC, as seller, Ferrellgas, L.P., as servicer, Jupiter Securitization Corporation, the financial institutions from time to time party hereto, Fifth Third Bank and JPMorgan Chase Bank, NA, as agent. Incorporated by reference to Exhibit 99.2 to our Current Report on Form 8-K filed August 18, 2006.

		10.11	Amendment No. 2 to Second Amended and Restated Receivables Purchase Agreement dated May 31, 2007, by and among Ferrellgas Receivables, LLC, as seller, Ferrellgas, L.P., as servicer, Jupiter Securitization Corporation, the financial institutions from time to time party hereto, Fifth Third Bank and JPMorgan Chase Bank, NA, as agent. Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K filed June 1, 2007.

		10.12	Agreement and Plan of Merger dated as of February 8, 2004, by and among Blue Rhino Corporation, FCI Trading Corp., Diesel Acquisition, LLC and Ferrell Companies, Inc. Incorporated by reference to Exhibit 99.2 to our Current Report on Form 8-K filed February 13, 2004.

		10.13	First Amendment to the Agreement and Plan of Merger dated as of March 16, 2004, by and among Blue Rhino Corporation, FCI Trading Corp., Diesel Acquisition, LLC, and Ferrell Companies, Inc. Incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K filed April 2, 2004.

		10.14	Asset Purchase Agreement dated as of June 22, 2005 by and among Ferrellgas, L.P., Ferrellgas, Inc. and Enterprise Products Operating L.P. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on June 23, 2005.

		10.15	Real Property Contribution Agreement dated February 8, 2004, between Ferrellgas Partners, L.P. and Billy D. Prim. Incorporated by reference to Exhibit 10.15 to our Quarterly Report on Form 10-Q filed June 14, 2004.

		10.16	Unit Purchase Agreement dated February 8, 2004, between Ferrellgas Partners, L.P. and Billy D. Prim. Incorporated by reference to Exhibit 4.5 to our Form S-3 filed May 21, 2004.

		10.17	Unit Purchase Agreement dated February 8, 2004, between Ferrellgas Partners, L.P. and James E. Ferrell. Incorporated by reference to Exhibit 99.3 to our Current Report on Form 8-K filed February 12, 2004.

#		10.18	Ferrell Companies, Inc. Supplemental Savings Plan, restated January 1, 2000. Incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K filed February 18, 2003.

#		10.19	Second Amended and Restated Ferrellgas Unit Option Plan. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed June 5, 2001.

#		10.20	Ferrell Companies, Inc. 1998 Incentive Compensation Plan, as amended and restated effective October 11, 2004. Incorporated by reference to Exhibit 10.23 to our Annual Report on Form 10-K filed October 13, 2004.


	Exhibit
	Number		Description
#		10.21	Employment Agreement between James E. Ferrell and Ferrellgas, Inc., dated July 31, 1998. Incorporated by reference to Exhibit 10.13 to our Annual Report on Form 10-K filed October 29, 1998.

#		10.22	Waiver to Employment, Confidentiality, and Non-Compete Agreement by and among Ferrell Companies, Inc., Ferrellgas, Inc., James E. Ferrell and Greatbanc Trust Company, dated as of December 19, 2006. Incorporated by reference to Exhibit 10.19 to our Quarterly Report on Form 10-Q filed March 9, 2007.

#		10.23	Amended and Restated Employment Agreement dated October 11, 2004, by and among Ferrellgas, Inc., Ferrell Companies, Inc. and Billy D. Prim. Incorporated by reference to Exhibit 10.25 to our Annual Report on Form 10-K filed October 13, 2004.

#		10.24	Separation Agreement and Release dated March 9, 2006 between Timothy E. Scronce and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.28 to our Quarterly Report on Form 10-Q filed March 10, 2006.

#		10.25	Agreement and Release dated as of May 11, 2006 by and among Jeffrey B. Ward, Ferrellgas, Inc., Ferrell Companies, Inc., Ferrellgas Partners, L.P. and Ferrellgas, L.P. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed June 22, 2006.

#		10.26	Agreement and Release dated as of August 15, 2006 by and among Kenneth A. Heinz, Ferrellgas, Inc., Ferrell Companies, Inc., Ferrellgas Partners, L.P. and Ferrellgas, L.P. Incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K filed August 18, 2006.

#		10.27	Change In Control Agreement dated as of October 9, 2006 by and between Stephen L. Wambold and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.23 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.28	Change In Control Agreement dated as of October 9, 2006 by and between Eugene D. Caresia and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.24 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.29	Change In Control Agreement dated as of October 9, 2006 by and between Kevin T. Kelly and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.26 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.30	Change In Control Agreement dated as of October 9, 2006 by and between Brian J. Kline and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.27 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.31	Change In Control Agreement dated as of October 9, 2006 by and between George L. Koloroutis and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.28 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.32	Change In Control Agreement dated as of October 9, 2006 by and between Patrick J. Walsh and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.29 to our Annual Report on Form 10-K filed October 12, 2006.


	Exhibit
	Number		Description
#		10.33	Change In Control Agreement dated as of October 9, 2006 by and between James E. Ferrell and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.30 to our Annual Report on Form 10-K filed October 12, 2006.

#		10.34	Change In Control Agreement dated as of October 9, 2006 by and between Tod D. Brown and Ferrellgas, Inc. Incorporated by reference to Exhibit 10.31 to our Annual Report on Form 10-K filed October 12, 2006.

*		31.1	Certification of Ferrellgas Partners, L.P. pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.

*		31.2	Certification of Ferrellgas Partners Finance Corp. pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.

*		31.3	Certification of Ferrellgas, L.P. pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.

*		31.4	Certification of Ferrellgas Finance Corp. pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.

*		32.1	Certification of Ferrellgas Partners, L.P. pursuant to 18 U.S.C. Section 1350.

*		32.2	Certification of Ferrellgas Partners Finance Corp. pursuant to 18 U.S.C. Section 1350.

*		32.3	Certification of Ferrellgas, L.P. pursuant to 18 U.S.C. Section 1350.

*		32.4	Certification of Ferrellgas Finance Corp. pursuant to 18 U.S.C. Section 1350.


*		Filed herewith

#		Management contracts or compensatory plans.

Positive
Negative
Uncertain
Constraining
Legalese
Litigous
Readability	6th grade Avg

Ferrellgas Partners (FGPR) 10-Q2007 Q3 Quarterly report

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