Ferrellgas Partners, L.P. (Form: 8-K)

Overland Park, KS (March 10, 2006)—Ferrellgas Partners, L.P. (NYSE: FGP), one of the nation’s largest propane distributors, today reported earnings for its fiscal second quarter ended January 31, 2006.

Net earnings from continuing operations of $58.1 million for the fiscal quarter improved by 8% while Adjusted EBITDA from continuing operations of $105.9 million improved by 4%, each as compared to the second quarter of the prior fiscal year as contributions from the partnership’s new operating platform more than offset the impacts of significantly warmer than normal winter temperatures and the high wholesale energy commodity price on customer demand.

Nationwide temperatures for the fiscal quarter, as measured by the National Oceanic and Atmospheric Administration, were 13% warmer than normal and 6% warmer than the same prior year period and for the month of January 2006, nationwide temperatures were 29% warmer than normal and 25% warmer than January 2005 making it the warmest in recorded history. January typically represents the partnership’s largest gallon sales month.

Gross profit for the second fiscal quarter was $220.8 million compared to $217.3 million achieved in the second quarter of fiscal 2005, as improved margins resulting from enhanced pricing controls available under the new operating platform and the continued growth in the Blue Rhino-branded tank exchange sales more than offset the impact of reduced propane gallon sales in the fiscal quarter.

Propane gallon sales for the second fiscal quarter were 283.3 million compared to 331.5 million gallons sold in the second quarter of fiscal 2005. For the first two months of the second fiscal quarter propane gallon sales were off 7% compared to the same two-month period last year. However, with the record-setting nationwide warm temperatures experienced during the month of January, gallon sales for the fiscal quarter were most notably impacted by January 2006 gallons sales that were off 27% compared to the same period last year.

“Despite the impact from January’s record warm temperatures, we are proud of how our company managed through this challenging quarter,” said James E. Ferrell, Chairman, President and Chief Executive Officer. “We are pleased that we continued our positive earnings momentum in the first two months of the quarter by improving our year-to-date Adjusted EBITDA by more than $24 million compared to the first five months of fiscal 2005. With the return of some cooler temperatures at the beginning of our 3^rd quarter, we are again experiencing significant earnings improvement that we believe will be reflected in our Adjusted EBITDA results in the last half of fiscal 2006.”

Operating expense for the fiscal quarter was $96.6 million, down from $97.4 million in the second quarter of fiscal 2005. Anticipated savings achieved from the new operating platform were offset by increased variable expenses, including vehicle fuel costs and the continued growth in tank exchange sales volumes. General and administrative expense for the second fiscal quarter was $11.8 million, which is consistent with the second quarter of fiscal 2005 and equipment lease expense was $7.2 million, which is consistent with the prior two fiscal quarters.

“This quarter’s challenging environment gave us the opportunity to showcase the capabilities of our new operating model. Although we are still fine tuning the new model in an effort to better optimize our resources, the results thus far are very impressive,” said Mr. Ferrell. “Most notably, we are pleased with the improved control we have in pricing our product to the various channels of our business. With quicker access to better customer information, we were able to improve margins this last quarter while continuing to grow our net customer base.”

For the six-months ended January 31, 2006, propane sales volumes and gross profit were 451 million gallons and $348.4 million, respectively, and operating and general and administrative expenses were $186.3 million and $22.9 million, respectively. Interest and depreciation and amortization expenses for the six-month period were $42.1 million and $42.7 million, respectively, and equipment lease expense for the period was $14.2 million. Adjusted EBITDA from continuing operations and net earnings from continuing operations for the period were $126.2 million and $32.3 million, respectively.

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 10K/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)


	January 31,			July 31,
ASSETS	2006			2005
Current Assets:
Cash and cash equivalents	$	30,212		$	20,505
Accounts and notes receivable, net		118,705			107,778
Inventories		138,267			97,743
Prepaid expenses and other current assets		15,811			12,861

Total Current Assets		302,995			238,887

Property, plant and equipment, net		745,874			766,765
Goodwill		233,805			234,142
Intangible assets, net		254,474			255,277
Other assets, net		12,784			13,902

Total Assets	$	1,549,932		$	1,508,973


LIABILITIES AND PARTNERS’ CAPITAL

Current Liabilities:
Accounts payable	$	148,907		$	108,667
Short term borrowings		22,167			19,800
Other current liabilities (a)		73,975			71,535

Total Current Liabilities		245,049			200,002

Long-term debt (a)		961,473			948,977
Other liabilities		20,120			20,165
Contingencies and commitments		—			—
Minority interest		6,000			6,151

Partners’ Capital:
Common unitholders (60,478,074 and 60,134,054 units outstanding at January 2006 and July 2005, respectively)		375,133			390,422
General partner unitholder (610,890 and 607,415 units outstanding at January 2006 and July 2005, respectively)		(56,285	)		(56,132	)
Accumulated other comprehensive loss		(1,558	)		(612	)

Total Partners’ Capital		317,290			333,678

Total Liabilities and Partners’ Capital	$	1,549,932		$	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 AND SIX MONTHS ENDED JANUARY 31, 2006 AND 2005
(in thousands, except per unit data)
(unaudited)


	Three months ended						Six months ended
	January 31,						January 31,
	2006			2005			2006			2005
Revenues:
Propane and other gas liquids sales	$	580,381		$	574,875		$	933,799		$	887,897
Other		72,187			47,016			104,367			77,766

Total revenues		652,568			621,891			1,038,166			965,663

Cost of product sold:
Propane and other gas liquids sales		385,615			380,340			631,262			599,846
Other		46,114			24,284			58,469			36,010


Gross profit		220,839			217,267			348,435			329,807

Operating expense		96,611			97,388			186,335			185,860
Depreciation and amortization expense		21,623			21,032			42,726			40,624
General and administrative expense		11,773			11,517			22,941			21,839
Equipment lease expense		7,197			6,147			14,217			11,907
Employee stock ownership plan compensation charge		2,467			2,358			4,924			4,445
Loss on sale of assets and other		1,041			1,817			2,637			3,073


Operating income		80,127			77,008			74,655			62,059

Interest expense		(21,240	)		(23,196	)		(42,115	)		(46,059	)
Interest income		531			657			908			976


Earnings before income taxes, minority interest, and
discontinued operations		59,418			54,469			33,448			16,976

Income tax expense (benefit)		700			339			700			(67	)
Minority interest (b)		654			608			452			295

Earnings from continuing operations before
discontinued operations		58,064			53,522			32,296			16,748

Earnings from discontinued operations, net of minority interest		—			3,596			—			5,381


Net earnings		58,064			57,118			32,296			22,129

Distributions to senior unitholder		—			1,994			—			3,988
Net earnings available to general partner		6,605			7,595			323			181


Net earnings available to common unitholders	$	51,459		$	47,529		$	31,973		$	17,960


Basic earnings per common unit:
Net earnings available to common unitholders
before discontinued operations (c)	$	0.85		$	0.82		$	0.53		$	0.25
Earnings from discontinued operations		—			0.06			—			0.10

Net earnings available to common unitholders (e)	$	0.85		$	0.88		$	0.53		$	0.35

Weighted average common units outstanding		60,397.4			53,706.5			60,279.7			52,032.5


	Three months ended						Six months ended
	January 31,						January 31,
	2006			2005			2006			2005
Propane gallons (j)		283,292			331,461			450,699			516,160


Net earnings	$	58,064		$	57,118		$	32,296		$	22,129
Income tax expense (benefit)		700			339			700			(67	)
Interest expense		21,240			23,196			42,115			46,059
Depreciation and amortization expense		21,623			21,032			42,726			40,624
Interest income		(531	)		(657	)		(908	)		(976	)

EBITDA		101,096			101,028			116,929			107,769
Employee stock ownership plan compensation charge		2,467			2,358			4,924			4,445
Unit and stock-based compensation charge (f)		688			—			1,235			—
Non-cash charges related to discontinued operations (a)		—			338			—			611
Loss on disposal of assets and other		1,041			1,817			2,637			3,073
Minority interest (b)		654			608			452			295

Adjusted EBITDA (d)		105,946			106,149			126,177			116,193
Adjusted EBITDA from discontinued operations		—			3,934			—			5,992

Adjusted EBITDA from continuing operations		105,946			102,215			126,177			110,201
Net cash interest expense (g)		(21,847	)		(22,537	)		(42,801	)		(44,601	)
Maintenance capital expenditures (h)		(3,233	)		(5,217	)		(6,059	)		(11,041	)

Distributable cash flow to equity investors (i)	$	80,866		$	74,461		$	77,317		$	54,559

(a)

Non-cash earnings related to the storage and distribution business sold during July 2005 that were classified as discontinued operations for the three and six months ended January 31, 2005.

(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, unit and stock-based 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 typically impact the three months ending January 31. The dilutive effect of EITF 03-6 on basic net earnings per common unit was $0.10 and $0.14 for the three months ended January 31, 2006 and 2005, respectively. EITF 03-6 did not result in a dilutive effect for the six months ended January 31, 2006 and 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 $0.6 million to operating expense and general and administrative expense, respectively, for the three months ended January 31, 2006, and $0.2 million and $1.0 million to operating expense and general and administrative expense, respectively,for the six months ended January 31, 2006.

(g)

Net cash interest expense is the sum of interest expense less non-cash interest expense and interest income. This amount also includes interest expense related to the accounts receivable securitization facility.

(h)

Maintenance capital expenditures include capitalized expenditures for betterment and replacement of property, plant and equipment.

(i)

Management considers Distributable cash flow to equity investors a meaningful non-GAAP measure of the partnership’s ability to declare and pay quarterly distributions to common unitholders. Distributable cash flow, as management defines it, may not be comparable to distributable cash flow or similarly titled measures used by other corporations and partnerships.

(j)

Propane gallons includes 2.1 million gallons and 2.8 million gallons for the three and six months ended January 31, 2005 related to the storage and distribution business sold during July 2005 that were classified as discontinued operations.


Delaware	001-11331	43-1698480
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)

7500 College Blvd., Suite 1000, Overland Park, Kansas		66210
_________________________________ (Address of principal executive offices)		___________ (Zip Code)


Delaware	333-06693	43-1742520
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)

7500 College Blvd., Suite 1000, Overland Park, Kansas		66210
_________________________________ (Address of principal executive offices)		___________ (Zip Code)


Delaware	000-50182	43-1698481
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)

7500 College Blvd., Suite 1000, Overland Park, Kansas		66210
_________________________________ (Address of principal executive offices)		___________ (Zip Code)


Delaware	000-50183	14-1866671
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)

7500 College Blvd., Suite 1000, Overland Park, Kansas		66210
_________________________________ (Address of principal executive offices)		___________ (Zip Code)


	Ferrellgas Partners, L.P.

March 10, 2006	By:	Kevin T. Kelly

		Name: Kevin T. Kelly
		Title: (By Ferrellgas, Inc., the Partnership's general partner) Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)


Date of Report (Date of Earliest Event Reported):		March 10, 2006


Registrant’s telephone number, including area code:		913-661-1500


	Ferrellgas Partners Finance Corp.

March 10, 2006	By:	Kevin T. Kelly

		Name: Kevin T. Kelly
		Title: Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)


	Ferrellgas, L.P.

March 10, 2006	By:	Kevin T. Kelly

		Name: Kevin T. Kelly
		Title: (By Ferrellgas, Inc., the Partnership's general partner) Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)


	Ferrellgas Finance Corp.

March 10, 2006	By:	Kevin T. Kelly

		Name: Kevin T. Kelly
		Title: Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)


Exhibit No.		Description

99.1		Press release