Guarantor financial information | R. Guarantor financial information The $500.0 million aggregate principal amount of registered 6.75% senior notes due 2023 co-issued by Ferrellgas, L.P. and Ferrellgas Finance Corp. are fully and unconditionally and jointly and severally guaranteed by all of Ferrellgas, L.P.’s 100% owned subsidiaries except: (i) Ferrellgas Finance Corp; (ii) certain special purposes subsidiaries formed for use in connection with our accounts receivable securitization; and (iii) foreign subsidiaries. Guarantees of these senior notes will be released under certain circumstances, including (i) in connection with any sale or other disposition of (a) all or substantially all of the assets of a guarantor or (b) all of the capital stock of such guarantor (including by way of merger or consolidation), in each case, to a person that is not Ferrellgas, L.P. or a restricted subsidiary of Ferrellgas, L.P., (ii) if Ferrellgas, L.P. designates any restricted subsidiary that is a guarantor as an unrestricted subsidiary, (iii) upon defeasance or discharge of the notes, (iv) upon the liquidation or dissolution of such guarantor, or (v) at such time as such guarantor ceases to guarantee any other indebtedness of either of the issuers and any other guarantor. The guarantor financial information discloses in separate columns the financial position, results of operations and the cash flows of Ferrellgas, L.P. (Parent), Ferrellgas Finance Corp. (co-issuer), Ferrellgas L.P.’s guarantor subsidiaries on a combined basis, and Ferrellgas L.P.’s non-guarantor subsidiaries on a combined basis. The dates and the periods presented in the guarantor financial information are consistent with the periods presented in Ferrellgas, L.P.’s consolidated financial statements. FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEETS (in thousands) As of July 31, 2019 Ferrellgas, L.P. Ferrellgas (Parent and Finance Corp. Guarantor Non-Guarantor Co-Issuer) (Co-Issuer) Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ 11,045 $ 1 $ — $ — $ — $ 11,046 Accounts and notes receivable, net (3,912) — 35 111,473 — 107,596 Intercompany receivables (5,650) — — — 5,650 — Inventories 80,454 — — — — 80,454 Assets held for sale — — — — — — Prepaid expenses and other current assets 42,158 — (1) — — 42,157 Total current assets 124,095 1 34 111,473 5,650 241,253 Property, plant and equipment, net 596,724 — (1) — — 596,723 Goodwill, net 247,195 — — — — 247,195 Intangible assets, net 108,557 — — — — 108,557 Investments in consolidated subsidiaries 52,999 — — — (52,999) — Other assets, net 65,447 — 2,875 783 — 69,105 Total assets $ 1,195,017 $ 1 $ 2,908 $ 112,256 $ (47,349) $ 1,262,833 LIABILITIES AND PARTNERS' CAPITAL (DEFICIT) Current liabilities: Accounts payable $ 33,252 $ — $ — $ 112 $ — $ 33,364 Short-term borrowings 43,000 — — — — 43,000 Collateralized note payable — — — 62,000 — 62,000 Intercompany payables — — (192) (5,458) 5,650 — Current portion of long-term debt 277,029 — — — — 277,029 Other current liabilities 128,666 — 20 5,617 — 134,303 Total current liabilities 481,947 — (172) 62,271 5,650 549,696 Long-term debt 1,457,004 — — — — 1,457,004 Other liabilities 36,469 — 67 — — 36,536 Contingencies and commitments Partners' capital (deficit): Partners' equity (765,756) 1 3,013 49,985 (52,999) (765,756) Accumulated other comprehensive loss (14,647) — — — — (14,647) Total partners' capital (deficit) (780,403) 1 3,013 49,985 (52,999) (780,403) Total liabilities and partners' capital (deficit) $ 1,195,017 $ 1 $ 2,908 $ 112,256 $ (47,349) $ 1,262,833 FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEETS (in thousands) As of July 31, 2018 Ferrellgas, L.P. Ferrellgas (Parent and Finance Corp. Guarantor Non-Guarantor Co-Issuer) (Co-Issuer) Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ 119,133 $ 1 $ 174 $ — $ — $ 119,308 Accounts and notes receivable, net (3,420) — 9,395 120,079 — 126,054 Intercompany receivables 15,660 — — — (15,660) — Inventories 83,694 — — — — 83,694 Prepaid expenses and other current assets 34,050 — 775 5 — 34,830 Total current assets 249,117 1 10,344 120,084 (15,660) 363,886 Property, plant and equipment, net 557,689 — 34 — — 557,723 Goodwill, net 246,098 — — — — 246,098 Intangible assets, net 120,951 — — — — 120,951 Investments in consolidated subsidiaries 59,937 — — — (59,937) — Other assets, net 63,411 — 9,961 1,216 — 74,588 Total assets $ 1,297,203 $ 1 $ 20,339 $ 121,300 $ (75,597) $ 1,363,246 LIABILITIES AND PARTNERS' CAPITAL (DEFICIT) Current liabilities: Accounts payable $ 45,171 $ — $ 1,547 $ 102 $ — $ 46,820 Short-term borrowings 32,800 — — — — 32,800 Collateralized note payable — — — 58,000 — 58,000 Intercompany payables — — (143) 15,803 (15,660) — Current portion of long-term debt 2,402 — — — — 2,402 Other current liabilities 129,300 — 6,036 353 — 135,689 Total current liabilities 209,673 — 7,440 74,258 (15,660) 275,711 Long-term debt 1,728,137 — — — — 1,728,137 Other liabilities 39,471 — 5 — — 39,476 Contingencies and commitments Partners' capital (deficit): Partners' equity (700,811) 1 12,894 47,042 (59,937) (700,811) Accumulated other comprehensive income 20,733 — — — — 20,733 Total partners' capital (deficit) (680,078) 1 12,894 47,042 (59,937) (680,078) Total liabilities and partners' capital (deficit) $ 1,297,203 $ 1 $ 20,339 $ 121,300 $ (75,597) $ 1,363,246 FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (in thousands) For the year ended July 31, 2019 Ferrellgas, L.P. Ferrellgas (Parent and Finance Corp. Guarantor Non-Guarantor Co-Issuer) (Co-Issuer) Subsidiaries Subsidiaries Eliminations Consolidated Revenues: Propane and other gas liquids sales $ 1,608,858 $ — $ — $ — $ — $ 1,608,858 Other 75,485 — 49 — — 75,534 Total revenues 1,684,343 — 49 — — 1,684,392 Costs and expenses: Cost of sales - propane and other gas liquids sales 902,516 — — — — 902,516 Cost of sales - other 11,292 — 114 — — 11,406 Operating expense 469,652 — 37 3,589 (4,410) 468,868 Depreciation and amortization expense 78,400 — — 446 — 78,846 General and administrative expense 59,974 6 — — — 59,980 Equipment lease expense 33,073 — — — — 33,073 Non-cash employee stock ownership plan compensation charge 5,693 — — — — 5,693 Loss on asset sales and disposals 8,289 — 2,679 — — 10,968 Operating income (loss) 115,454 (6) (2,781) (4,035) 4,410 113,042 Interest expense (132,929) — (38) (9,668) — (142,635) Other income (expense), net 428 — (59) 4,410 (4,410) 369 Earnings (loss) before income taxes (17,047) (6) (2,878) (9,293) — (29,224) Income tax expense 105 — 188 — — 293 Equity in earnings (loss) of subsidiary (12,365) — — — 12,365 — Net earnings (loss) (29,517) (6) (3,066) (9,293) 12,365 (29,517) Other comprehensive loss (35,380) — — — — (35,380) Comprehensive income (loss) $ (64,897) $ (6) $ (3,066) $ (9,293) $ 12,365 $ (64,897) FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (in thousands) For the year ended July 31, 2018 Ferrellgas, L.P. Ferrellgas (Parent and Finance Corp. Guarantor Non-Guarantor Co-Issuer) (Co-Issuer) Subsidiaries Subsidiaries Eliminations Consolidated Revenues: Propane and other gas liquids sales $ 1,642,155 $ — $ 821 $ — $ — $ 1,642,976 Midstream operations — — 282,319 — — 282,319 Other 72,954 — 74,893 — — 147,847 Total revenues 1,715,109 — 358,033 — — 2,073,142 Costs and expenses: Cost of sales - propane and other gas liquids sales 972,467 — 947 — — 973,414 Cost of sales - midstream operations — — 255,559 — — 255,559 Cost of sales - other 10,111 — 58,543 — — 68,654 Operating expense 436,962 — 37,617 4,755 (7,586) 471,748 Depreciation and amortization expense 75,163 — 26,317 315 — 101,795 General and administrative expense 48,337 5 5,922 — — 54,264 Equipment lease expense 27,939 — 333 — — 28,272 Non-cash employee stock ownership plan compensation charge 13,859 — — — — 13,859 Asset impairments — — 10,005 — — 10,005 Loss on asset sales and disposals 8,978 — 178,421 — — 187,399 Operating income (loss) 121,293 (5) (215,631) (5,070) 7,586 (91,827) Interest expense (86,646) — (43,247) (4,053) — (133,946) Other income (expense), net (234) — 1,162 7,586 (7,586) 928 Earnings (loss) before income taxes 34,413 (5) (257,716) (1,537) — (224,845) Income tax expense 222 — (2,921) — — (2,699) Equity in earnings (loss) of subsidiary (256,337) — — — 256,337 — Net earnings (loss) (222,146) (5) (254,795) (1,537) 256,337 (222,146) Other comprehensive income 5,969 — — — — 5,969 Comprehensive income (loss) $ (216,177) $ (5) $ (254,795) $ (1,537) $ 256,337 $ (216,177) FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (in thousands) For the year ended July 31, 2017 Ferrellgas, L.P. Ferrellgas (Parent and Finance Corp. Guarantor Non-Guarantor Co-Issuer) (Co-Issuer) Subsidiaries Subsidiaries Eliminations Consolidated Revenues: Propane and other gas liquids sales $ 1,318,412 $ — $ — $ — $ — $ 1,318,412 Midstream operations — — 466,703 — — 466,703 Other 69,962 — 75,200 — — 145,162 Total revenues 1,388,374 — 541,903 — — 1,930,277 Costs and expenses: Cost of sales - propane and other gas liquids sales 694,155 — — — — 694,155 Cost of sales - midstream operations — — 429,439 — — 429,439 Cost of sales - other 8,473 — 58,794 — — 67,267 Operating expense 398,584 — 38,188 95 (4,455) 432,412 Depreciation and amortization expense 72,919 — 30,183 249 — 103,351 General and administrative expense 44,810 5 4,663 — — 49,478 Equipment lease expense 28,560 — 564 — — 29,124 Non-cash employee stock ownership plan compensation charge 15,088 — — — — 15,088 Asset impairments — — — — — — Loss on asset sales and disposals 9,198 — 5,259 — — 14,457 Operating income (loss) 116,587 (5) (25,187) (344) 4,455 95,506 Interest expense (80,866) — (43,839) (2,480) (3) (127,188) Other income (expense), net 850 — 624 4,452 (4,452) 1,474 Earnings (loss) before income taxes 36,571 (5) (68,402) 1,628 — (30,208) Income tax expense (benefit) 217 — (1,366) — — (1,149) Equity in earnings (loss) of subsidiaries (65,413) — — — 65,413 — Net earnings (loss) (29,059) (5) (67,036) 1,628 65,413 (29,059) Other comprehensive loss 25,324 — — — — 25,324 Comprehensive income (loss) $ (3,735) $ (5) $ (67,036) $ 1,628 $ 65,413 $ (3,735) FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (in thousands) For the year ended July 31, 2019 Ferrellgas, L.P. Ferrellgas (Parent and Finance Corp. Guarantor Non-Guarantor Co-Issuer) (Co-Issuer) Subsidiaries Subsidiaries Eliminations Consolidated Cash flows from operating activities: Net cash provided by (used in) operating activities $ 25,796 $ (6) $ 24,889 $ (717) $ (4,000) $ 45,962 Cash flows from investing activities: Business acquisitions, net of cash acquired (13,551) — — — — (13,551) Capital expenditures (108,822) — — — — (108,822) Proceeds from sale of assets 5,699 — — — — 5,699 Cash collected for purchase of interest in accounts receivable — — — 1,258,050 (1,258,050) — Cash remitted to Ferrellgas, L.P. for accounts receivable — — — (1,262,050) 1,262,050 — Intercompany loan to affiliate 24,328 — — — (24,328) — Cash payments to construct assets in connection with future lease transactions (9,934) (9,934) Cash receipts in connection with leased vehicles 862 862 Other 1,419 — — — — 1,419 Net cash used in investing activities (99,999) — — (4,000) (20,327) (124,327) Cash flows from financing activities: Distributions (41,121) — — — — (41,121) Proceeds from increase in long-term debt — — — — — — Reductions in long-term debt (2,428) — — — — (2,428) Net additions to short-term borrowings 10,200 — — — — 10,200 Net additions to collateralized short-term borrowings — — — 4,000 — 4,000 Net changes in advances with consolidated entities — 6 (25,063) 729 24,328 (0) Cash paid for financing costs (536) — — (12) — (548) Net cash provided by (used in) financing activities (33,885) 6 (25,063) 4,717 24,328 (29,897) Net change in cash and cash equivalents (108,088) — (174) (0) 0 (108,262) Cash and cash equivalents - beginning of year 119,133 1 174 — — 119,308 Cash and cash equivalents - end of year $ 11,045 $ 1 $ — $ (0) $ 0 $ 11,046 FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (in thousands) For the year ended July 31, 2018 Ferrellgas, L.P. Ferrellgas (Parent and Finance Corp. Guarantor Non-Guarantor Co-Issuer) (Co-Issuer) Subsidiaries Subsidiaries Eliminations Consolidated Cash flows from operating activities: Net cash provided by (used in) operating activities $ 139,294 $ (5) $ (48,708) $ 3,573 $ 11,000 $ 105,154 Cash flows from investing activities: Business acquisitions, net of cash acquired (18,141) — — — — (18,141) Capital expenditures (81,114) — (3,805) — — (84,919) Proceeds from sale of assets 7,327 — 145,260 — — 152,587 Cash collected for purchase of interest in accounts receivable — — — 1,226,211 (1,226,211) — Cash remitted to Ferrellgas, L.P. for accounts receivable — — — (1,215,211) 1,215,211 — Net changes in advances with consolidated entities 96,514 — — — (96,514) — Net cash provided by (used in) investing activities 4,586 — 141,455 11,000 (107,514) 49,527 Cash flows from financing activities: Distributions (70,962) — — — — (70,962) Proceeds from increase in long-term debt 323,680 — — — — 323,680 Payments on long-term debt (212,920) — — — — (212,920) Net reductions in short-term borrowings (51,379) — — — — (51,379) Net additions to collateralized short-term borrowings — — — (11,000) — (11,000) Net changes in advances with parent — 5 (92,946) (3,573) 96,514 — Cash paid for financing costs (18,493) — — — — (18,493) Net cash provided by (used in) financing activities (30,074) 5 (92,946) (14,573) 96,514 (41,074) Net change in cash and cash equivalents 113,806 — (199) — — 113,607 Cash and cash equivalents - beginning of year 5,327 1 373 — — 5,701 Cash and cash equivalents - end of year $ 119,133 $ 1 $ 174 $ — $ — $ 119,308 FERRELLGAS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (in thousands) For the year ended July 31, 2017 Ferrellgas, L.P. Ferrellgas (Parent and Finance Corp. Guarantor Non-Guarantor Co-Issuer) (Co-Issuer) Subsidiaries Subsidiaries Eliminations Consolidated Cash flows from operating activities: Net cash provided by (used in) operating activities $ 185,640 $ (5) $ (36,297) $ 4,410 $ (5,000) $ 148,748 Cash flows from investing activities: Business acquisitions, net of cash acquired (3,539) — — — — (3,539) Capital expenditures (49,107) — (1,365) — — (50,472) Proceeds from sale of assets, dispositions and other 8,510 — — — — 8,510 Cash collected for purchase of interest in accounts receivable — — — 1,011,244 (1,011,244) — Cash remitted to Ferrellgas, L.P for accounts receivable — — — (1,016,244) 1,016,244 — Net changes in advances with consolidated entities (33,573) — — 360 33,213 — Other (37) — — — — (37) Net cash provided by (used in) investing activities (77,746) — (1,365) (4,640) 38,213 (45,538) Cash flows from financing activities: Distributions (119,879) — — — — (119,879) Contributions 167,843 — — — — 167,843 Proceeds from issuance of long-term debt 62,864 — — — — 62,864 Payments on long-term debt (174,292) — — — — (174,292) Net additions to short-term borrowings (41,510) — — — — (41,510) Net reductions in collateralized short-term borrowings — — — 5,000 — 5,000 Net changes in advances with parent — 5 37,618 (4,410) (33,213) — Cash paid for financing costs (2,065) — — (360) — (2,425) Net cash provided by (used in) financing activities (107,039) 5 37,618 230 (33,213) (102,399) Effect of exchange rate changes on cash — — — — — — Increase (decrease) in cash and cash equivalents 855 — (44) — — 811 Cash and cash equivalents - beginning of year 4,472 1 417 — — 4,890 Cash and cash equivalents - end of year $ 5,327 $ 1 $ 373 $ — $ — $ 5,701 |