Leases

6 Months Ended

Jan. 31, 2021

Leases

C. Leases

The following table provides the operating and financing ROU assets and lease liabilities as of January  31, 2021 and July 31, 2020:

Leases	Classification		January 31, 2021		July 31, 2020
Assets
Operating lease assets	Operating lease right-of-use assets	$	97,249	$	107,349
Financing lease assets	Other assets, net		38,045		41,426
Total leased assets		$	135,294	$	148,775
Liabilities
Current
Operating	Current operating lease liabilities	$	27,895	$	29,345
Financing	Other current liabilities		7,405		6,955
Noncurrent
Operating	Operating lease liabilities		80,901		89,022
Financing	Other liabilities		30,537		33,473
Total leased liabilities		$	146,738	$	158,795

The following table provides the lease expenses for the three and six months ended January  31, 2021 and 2020:

		For the three months ended January 31,				For the six months ended January 31,
Leases expense	Classification	2021		2020		2021		2020
Operating lease expense	Operating expense - personnel, vehicle, plant and other	$	1,497	$	1,664	$	3,280	$	3,405
	Operating expense - equipment lease expense		6,513		8,156		12,955		15,763
	Cost of sales - propane and other gas liquids sales		492		324		1,018		713
	General and administrative expense		194		697		476		963
Total operating lease expense			8,696		10,841		17,729		20,844
Short-term expense	Operating expense - personnel, vehicle, plant and other		1,873		2,012		3,905		3,966
	General and administrative expense		123		141		364		251
Total short-term expense			1,996		2,153		4,269		4,217
Variable lease expense	Operating expense - personnel, vehicle, plant and other		798		671		1,544		1,346
	Operating expense - equipment lease expense		349		153		737		886
Total variable lease expense			1,147		824		2,281		2,232
Finance lease expense:
Amortization of leased assets	Depreciation and amortization expense		2,189		435		4,354		475
Interest on lease liabilities	Interest expense		963		318		1,908		360
Total finance lease expense			3,152		753		6,262		835
Total lease expense (a)		$	14,991	$	14,571	$	30,541	$	28,128

(a) For the three and six months ended January 31, 2021 Ferrellgas also recognized $0.1 million and $0.2 million, respectively, of expense related to the accretion of lease exit costs associated with a crude oil storage agreement that is no longer being utilized, primarily due to various Midstream dispositions, and for which Ferrellgas does not anticipate any future economic benefit. For the three and six months ended January 31, 2020 Ferrellgas also recognized $0.1 million and $0.2 million, respectively, of expense related to the accretion of lease exit costs associated with a crude oil storage agreement that is no longer being utilized, primarily due to various Midstream dispositions, and for which Ferrellgas does not anticipate any future economic benefit.

Minimum annual payments under existing operating and finance lease liabilities as of January  31, 2021 are as follows:

Maturities of lease liabilities		Operating leases		Finance leases		Total
2021	$	17,114	$	7,186	$	24,300
2022		28,110		9,851		37,961
2023		35,875		7,851		43,726
2024		19,055		7,262		26,317
2025		13,616		7,273		20,889
Thereafter		21,886		10,892		32,778
Total lease payments	$	135,656	$	50,315	$	185,971
Less: Imputed interest		26,860		12,373		39,233
Present value of lease liabilities	$	108,796	$	37,942	$	146,738

The following table represents the weighted-average remaining lease term and discount rate as of January  31, 2021:

	As of January 31, 2021
Lease type	Weighted-average remaining lease term (years)	Weighted-average discount rate
Operating leases	5.1	8.3%
Finance leases	5.6	8.7%

Cash flow information is presented below:

	For the six months ended January 31,
	2021		2020
Cash paid for amounts included in the measurement of lease liabilities for operating leases:
Operating cash flows	$	17,546	$	21,647
Cash paid for amounts included in the measurement of lease liabilities for financing leases:
Operating cash flows	$	1,729	$	360
Financing cash flows	$	3,460	$	320

Ferrellgas, L.P. [Member]

Leases

C. Leases

The following table provides the operating and financing ROU assets and lease liabilities as of January 31, 2021 and July 31, 2020:

Leases	Classification		January 31, 2021		July 31, 2020
Assets
Operating lease assets	Operating lease right-of-use assets	$	97,249	$	107,349
Financing lease assets	Other assets, net		38,045		41,426
Total leased assets		$	135,294	$	148,775
Liabilities
Current
Operating	Current operating lease liabilities	$	27,895	$	29,345
Financing	Other current liabilities		7,405		6,955
Noncurrent
Operating	Operating lease liabilities		80,901		89,022
Financing	Other liabilities		30,537		33,473
Total leased liabilities		$	146,738	$	158,795

The following table provides the lease expenses for the three and six months ended January  31, 2021 and 2020:

		For the three months ended January 31,				For the six months ended January 31,
Leases expense	Classification	2021		2020		2021		2020
Operating lease expense	Operating expense - personnel, vehicle, plant and other	$	1,497	$	1,664	$	3,280	$	3,405
	Operating expense - equipment lease expense		6,513		8,156		12,955		15,763
	Cost of sales - propane and other gas liquids sales		492		324		1,018		713
	General and administrative expense		194		697		476		963
Total operating lease expense			8,696		10,841		17,729		20,844
Short-term expense	Operating expense - personnel, vehicle, plant and other		1,873		2,012		3,905		3,966
	General and administrative expense		123		141		364		251
Total short-term expense			1,996		2,153		4,269		4,217
Variable lease expense	Operating expense - personnel, vehicle, plant and other		798		671		1,544		1,346
	Operating expense - equipment lease expense		349		153		737		886
Total variable lease expense			1,147		824		2,281		2,232
Finance lease expense:
Amortization of leased assets	Depreciation and amortization expense		2,189		435		4,354		475
Interest on lease liabilities	Interest expense		963		318		1,908		360
Total finance lease expense			3,152		753		6,262		835
Total lease expense (a)		$	14,991	$	14,571	$	30,541	$	28,128

(a) For the three and six months ended January 31, 2021 Ferrellgas, L.P. also recognized $0.1 million and $0.2 million, respectively, of expense related to the accretion of lease exit costs associated with a crude oil storage agreement that is no longer being utilized, primarily due to various Midstream dispositions, and for which Ferrellgas does not anticipate any future economic benefit. For the three and six months ended January 31, 2020 Ferrellgas, L.P. also recognized $0.1 million and $0.2 million, respectively, of expense related to the accretion of lease exit costs associated with a crude oil storage agreement that is no longer being utilized, primarily due to various Midstream dispositions, and for which Ferrellgas does not anticipate any future economic benefit.

Minimum annual payments under existing operating and finance lease liabilities as of January  31, 2021 are as follows:

Maturities of lease liabilities		Operating leases		Finance leases		Total
2021	$	17,114	$	7,186	$	24,300
2022		28,110		9,851		37,961
2023		35,875		7,851		43,726
2024		19,055		7,262		26,317
2025		13,616		7,273		20,889
Thereafter		21,886		10,892		32,778
Total lease payments	$	135,656	$	50,315	$	185,971
Less: Imputed interest		26,860		12,373		39,233
Present value of lease liabilities	$	108,796	$	37,942	$	146,738

The following table represents the weighted-average remaining lease term and discount rate as of January  31, 2021:

	As of January 31, 2021
Lease type	Weighted-average remaining lease term (years)	Weighted-average discount rate
Operating leases	5.1	8.3%
Finance leases	5.6	8.7%

Cash flow information is presented below:

	For the six months ended January 31,
	2021		2020
Cash paid for amounts included in the measurement of lease liabilities for operating leases:
Operating cash flows	$	17,546	$	21,647
Cash paid for amounts included in the measurement of lease liabilities for financing leases:
Operating cash flows	$	1,729	$	360
Financing cash flows	$	3,460	$	320