Ferrellgas Finance 8-K Ferrellgas Partners, L.P. Reports Record First Quarter Results

Exhibit 99.1

For immediate release
Contact:

     Ryan VanWinkle, Investor Relations, 913-661-1528
     Scott Brockelmeyer, Media Relations, 913-661-1830

Ferrellgas Partners, L.P.
Reports Record First Quarter Results

     Overland Park, KS(December 8, 2005)—Ferrellgas Partners, L.P. (NYSE: FGP), one of the nation’s largest propane distributors, today reported earnings for its fiscal first quarter ended October 31, 2005. The seasonal net loss for the quarter improved 26% compared to the prior year’s first quarter results. Due to the seasonal nature of the propane industry, the partnership has historically experienced a net loss during its fiscal first quarter as fixed costs exceed off-season cash flow.

     The resulting Adjusted EBITDA for the quarter was a record $20.2 million, more than doubling the Adjusted EBITDA of $8.0 million reported in the first quarter of fiscal 2005, as adjusted for discontinued operations.

     Gross profit for the first quarter was a record $127.6 million, an increase of 13% compared to the first quarter of fiscal 2005. This increase in gross profit was primarily due to improved margins resulting from enhanced pricing controls available under the partnership’s new operating platform and the continued growth in the Blue Rhino-branded tank exchange sales. These increases in gross profit were partially offset by the impact of reduced propane gallon sales as compared to the first quarter of fiscal 2005.

     Propane gallons sales for the first quarter were 167 million, a 9% decrease compared to the first quarter of fiscal 2005. This decrease primarily related to customer conservation, a warmer than normal start to the propane season this fall and the elimination of past inefficient propane deliveries due to the improved demand forecasting capabilities available under the new operating platform.

     “We are very pleased to deliver these anticipated, improved financial results to our investors,” said James E. Ferrell, Chairman, President and Chief Executive Officer. “The significant improvement in our financial performance this quarter is directly attributable to the remarkable results we are seeing from our fully implemented operating system and the continued growth in our tank exchange gallon sales, which have grown nearly 20% over the last 12 months.”

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     Operating expense for the quarter was $89.7 million, as compared to $88.5 million in the first quarter of fiscal 2005. Anticipated savings achieved from the new operating platform were offset by increased variable expenses primarily associated with vehicle fuel and incentive compensation costs and the continued growth in tank exchange sales volumes. General and administrative expense was $11.2 million for the fiscal first quarter, as compared to $10.3 million in the prior year quarter. Equipment lease expense for the first quarter was $7.0 million, as compared to $6.8 million and $5.8 million reported in the fiscal fourth and first quarters of 2005, respectively.

     “This quarter’s performance is the result of more than four years of development and deployment of advanced logistics and customer service technologies that have resulted in improved margins, reduced operating expenses and net customer gains,” said Mr. Ferrell. “With the winter heating season upon us we believe that we are well positioned, both operationally and financially, to perform regardless of external pressures such as potentially warmer winters or continued customer conservation.”

     Ferrellgas Partners, L.P., through its operating partnership, Ferrellgas, L.P., serves more than one million customers in all 50 states, the District of Columbia, Puerto Rico and Canada. Ferrellgas employees indirectly own more than 18 million common units of the partnership through an employee stock ownership plan.

Statements in this release concerning expectations for the future are forward-looking statements. A variety of known and unknown risks, uncertainties and other factors could cause results, performance and expectations to differ materially from anticipated results, performance and expectations. These risks, uncertainties and other factors are discussed in the Form 10-K of Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., Ferrellgas, L.P. and Ferrellgas Finance Corp. for the fiscal year ended July 31, 2005, as amended on Form 10-K/A, and other documents filed from time to time by these entities with the Securities and Exchange Commission.

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)
(unaudited)

ASSETS	October 31, 2005			July 31, 2005
Current Assets:
Cash and cash equivalents	$	24,541		$	20,505
Accounts and notes receivable, net		121,958			107,778
Inventories		161,865			97,743
Prepaid expenses and other current assets		17,336			12,861
Total Current Assets		325,700			238,887
Property, plant and equipment, net		756,480			766,765
Goodwill		234,663			234,142
Intangible assets, net		257,074			255,277
Other assets, net		13,429			13,902
Total Assets	$	1,587,346		$	1,508,973
LIABILITIES AND PARTNERS’ CAPITAL
Current Liabilities:
Accounts payable	$	157,604		$	108,667
Short term borrowings		82,982			19,800
Other current liabilities (a)		77,995			71,535
Total Current Liabilities		318,581			200,002
Long-term debt (a)		961,444			948,977
Other liabilities		20,337			20,165
Contingencies and commitments		—			—
Minority interest		5,670			6,151
Partners’ Capital:
Common unitholders (60,172,054 and 60,134,054 units outstanding at October 2005 and July 2005, respectively)		338,493			390,422
General partner unitholder (607,799 and 607,415 units outstanding at October 2005 and July 2005, respectively)		(56,658	)		(56,132	)
Accumulated other comprehensive loss		(521	)		(612	)
Total Partners’ Capital		281,314			333,678
Total Liabilities and Partners’ Capital	$	1,587,346		$	1,508,973

(a) The principal difference between the Ferrellgas Partners, L.P. balance sheet and that of Ferrellgas, L.P., is $268 million of 8 3/4% notes which are liabilities of Ferrellgas Partners, L.P. and not of Ferrellgas, L.P.

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2005 AND 2004
(in thousands, except per unit data)
(unaudited)

	Three months ended October 31,
��	2005			2004
Revenues:
Propane and other gas liquids sales	$	353,418		$	313,022
Other		32,180			30,750
Total revenues		385,598			343,772
Cost of product sold		258,002			231,232
Gross profit		127,596			112,540
Operating expense		89,724			88,472
Depreciation and amortization expense		21,103			19,592
General and administrative expense		11,168			10,322
Equipment lease expense		7,020			5,760
Employee stock ownership plan compensation charge		2,457			2,087
Loss on sale of assets and other		1,596			1,256
Operating loss		(5,472	)		(14,949	)
Interest expense		(20,875	)		(22,863	)
Interest income		377			319
Loss before income taxes, minority interest, and discontinued operations		(25,970	)		(37,493	)
Income tax benefit		—			(406	)
Minority interest (b)		(202	)		(313	)
Loss before discontinued operations		(25,768	)		(36,774	)
Earnings from discontinued operations		—			1,785
Net loss		(25,768	)		(34,989	)
Distribution to senior unitholder		—			1,994
Net loss available to general partner		(258	)		(370	)
Net loss available to common unitholders	$	(25,510	)	$	(36,613	)
Basic loss per common unit:
Net loss available to common unitholders before discontinued operations (c)	$	(0.42	)	$	(0.74	)
Earnings from discontinued operations		—			0.03
Net loss available to common unitholders (e)	$	(0.42	)	$	(0.71	)
Weighted average common units outstanding		60,162.1			51,505.1

Supplemental Data and Reconciliation of Non-GAAP Item:

	Three months ended October 31,
	2005			2004
Propane gallons		167,407			184,699
Net loss	$	(25,768	)	$	(34,989	)
Income tax benefit		—			(406	)
Interest expense		20,875			22,863
Depreciation and amortization expense		21,103			19,592
Interest income		(377	)		(319	)
EBITDA	$	15,833		$	6,741
Employee stock ownership plan compensation charge		2,457			2,087
Unit and stock-based compensation charge (f)		547			—
Non-cash charges related to discontinued operations(a)		—			273
Loss on disposal of assets and other		1,596			1,256
Minority interest (b)		(202	)		(313	)
Adjusted EBITDA (d)	$	20,231		$	10,044
Adjusted EBITDA from discontinued operations		—			2,058
Adjusted EBITDA from continuing operations	$	20,231		$	7,986

(a)	Earnings related to the storage and distribution business sold during July 2005 and other non-cash items related to the discontinued operations for the three months ended October 31, 2004.
(b)	Amounts allocated to the general partner for its 1.0101% interest in the operating partnership, Ferrellgas, L.P.
(c)	Amount calculated as 99% of the earnings (loss) before discontinued operations less distribution to senior unit holder; the result then divided by the weighted average common units outstanding.
(d)	Management considers Adjusted EBITDA to be a chief measurement of the partnership’s overall economic performance and return on invested capital. Adjusted EBITDA is calculated as earnings before interest, income taxes, depreciation and amortization, employee stock ownership plan compensation charge, loss on disposal of assets and other, minority interest and other non-cash and non-operating charges. Management believes the presentation of this measure is relevant and useful because it allows investors to view the partnership’s performance in a manner similar to the method management uses, adjusted for items management believes are unusual or non-recurring, and makes it easier to compare its results with other companies that have different financing and capital structures. In addition, management believes this measure is consistent with the manner in which the partnership’s lenders and investors measure its overall performance and liquidity, including its ability to pay quarterly equity distributions, service its long-term debt and other fixed obligations and to fund its capital expenditures and working capital requirements. This method of calculating Adjusted EBITDA may not be consistent with that of other companies and should be viewed in conjunction with measurements that are computed in accordance with GAAP.
(e)	Emerging Issues Task Force (“EITF”) 03-6 “Participating Securities and the Two-Class Method under FASB Statement No. 128, Earnings per Share,” requires the calculation of 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 to be 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 earnings to the limited partners. Due to the seasonality of the propane business, the dilution effect of EITF 03-6 on net earnings per limited partner unit will impact the three months and six months ending January 31. EITF 03-6 did not have a dilutive effect on the three months ended October 31, 2005.
(f)	Statement of Financial Accounting Standards (“SFAS”) No. 123( R), “Share-Based Payment” was adopted during the first quarter of fiscal 2006 and requires that the cost resulting from all share-based payment transactions be recognized in the financial statements. Management adopted this standard using the modified prospective application method which resulted in a non-cash compensation charge of $0.1 million and $0.4 million to operating expense and general and administrative expense, respectively, for the three months ended October 31, 2005.