"Ferrellgas had a strong start to fiscal 2026," said Tamria Zertuche, President and CEO. "In the first quarter, our employee-owners delivered strong operational results, and we successfully refinanced the notes due 2026 and our revolving credit facility. With this momentum, along with our recent credit rating upgrades from S&P Global and Moody's, our team remains focused on running the business efficiently and executing strategies that strengthen our performance. Due to the ongoing improvements in telematics, routing optimization, and our safety programs, we are confident and well prepared for the upcoming winter heating season and the full fiscal year."
Financial Highlights:
As previously announced, in October 2025 Ferrellgas completed several financing transactions, including redeeming the $650.0 million of Senior Notes due 2026, issuing $650.0 million of new Senior Notes due 2031, and extending and expanding our revolving credit facility. These actions strengthen our balance sheet and provide the financial flexibility to continue growing our business.
Margin per gallon increased 6% in the first fiscal quarter. A revenue decrease of $8.9 million, or 2%, was offset by a cost of product decrease of $8.8 million, or 5%. Gross profit was flat with a $0.1 million change compared to the prior year quarter, which is typical as the Company prepares for the upcoming winter season. Average propane prices (basis Mont Belvieu, Texas) for the first quarter of fiscal 2026 decreased 2.9% compared to the prior year first quarter. Despite the decrease in wholesale propane prices, retail sales were up $0.7 million as sales to residential and agricultural customers increased $2.8 million, partially offset by decreases related to sales to transport and industrial commercial customers. On the wholesale side, sales decreased $4.3 million as the quarter did not have any significant weather events compared to the prior year quarter.
For the first fiscal quarter, Adjusted EBITDA, a non-GAAP financial measure, decreased by $6.5 million, or 18%, to $29.3 million, compared to $35.8 million in the prior year quarter. After EBITDA adjustments primarily related to the prior year first quarter $125.0 million Eddystone litigation settlement, this quarter's decrease is primarily driven by increases of $5.6 million in operating expense and $2.1 million in general and administrative expense.
The $5.6 million increase in operating expense was due to increases of $4.1 million in personnel costs, $0.9 million in vehicle expense, and $0.6 million in plant and other. The $4.1 million increase in personnel costs primarily related to increases of $5.5 million in workers' compensation accruals and $2.8 million in payroll costs, due to planned merit increases for field and corporate support employees and in field-related headcount to address customer demand. These increases were partially offset by decreases of $3.3 million in medical and pharmacy claim expense and $0.9 million in overtime.
The $2.1 million increase in general and administrative expense was driven by $1.3 million in compensation costs related to the vesting of fiscal 2025 phantom plan grants for non-employee directors as well as the timing of adjustments to incentive accruals.
The Company recognized a net loss attributable to Ferrellgas Partners, L.P. of $26.9 million and $146.7 million in the first fiscal quarter of fiscal 2026 and 2025, respectively. As noted above, the first fiscal quarter of fiscal 2025 included the $125.0 million Eddystone litigation settlement.
Operational Highlights:
Our retail business benefited from increases in sales in the first fiscal quarter. Although weather was approximately 18% colder than prior year for the first fiscal quarter, it was 5.0% warmer than the 10-year average. Our temp heat tank sets increased 37% over prior year first quarter. Our focus on customer service and investment in onsite Customer Service Representatives resulted in improved customer retention, particularly in the North Central, Northeast, and Pacific regions. In preparing for winter, we focused on capturing our will call or on demand customers with a strategic outbound calling campaign. Our teams also delivered profitable growth with improvements in new residential customer tank sets of 15% and our residential conversion rate increased 2% over prior year quarter.
The wholesale business, including our tank exchange operations, saw volumes normalize in the first quarter of fiscal 2026 due to the absence of demand generated by land-falling storms, compared to the prior-year period, which benefited from multiple hurricanes in the Southeast. Even with lower storm-related demand, the Blue Rhino business executed with discipline, flexing production, labor, and logistics costs to align with volume and protect profitability. At the same time, we continued to invest in our production network and commercial footprint to support future growth. Our telematics initiatives also continued to enhance route optimization and improve fuel efficiency, particularly in idling and overall fuel consumption.
With our strengthened balance sheet, Ferrellgas is well positioned to pursue strategic growth and customer expansion and further our efficiency investments. Our strategic initiatives continue to drive improvement in operational excellence, technology, procurement buying power, asset resource profitability, and improving gas gains. As a result of these financial and operational improvements, along with our commitment to continuous improvement, we remain confident in our ability to generate sustainable results and add significant value to our stakeholders.
On Friday, December 12, 2025, the Company will conduct a teleconference on the Internet at https://edge.media-server.com/mmc/p/r3s9oiox to discuss the results of operations for the first fiscal quarter ended October 31, 2025. The webcast of the teleconference will begin at 8:00 a.m. Central Time (9:00 a.m. Eastern Time). Questions may be submitted via the investor relations e-mail box at
About Ferrellgas
Ferrellgas Partners, L.P., through its operating partnership, Ferrellgas, L.P., and subsidiaries, serves propane customers in all 50 states, the District of Columbia, and Puerto Rico. Its Blue Rhino propane exchange brand is sold at over 64,000 locations nationwide. Ferrellgas employees indirectly own 1.1 million Class A Units of the partnership, through an employee stock ownership plan. Ferrellgas Partners, L.P. filed an Annual Report on Form 10-K for the fiscal year ended July 31, 2025, with the Securities and Exchange Commission on October 15, 2025. Investors can request a hard copy of this filing free of charge and obtain more information about the partnership online at www.ferrellgas.com. For more information, follow Ferrellgas on Facebook, X, LinkedIn, and Instagram.
Cautionary Note Regarding Forward-Looking Statements
Statements included in this release concerning current estimates, expectations, projections about future results, performance, prospects, opportunities, plans, actions and events and other statements, concerns, or matters that are not historical facts are forward-looking statements as defined under federal securities laws. 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. 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, including the effect of weather conditions on the demand for propane; the prices of wholesale propane, motor fuel and crude oil; disruptions to the supply of propane; competition from other industry participants and other energy sources; energy efficiency and technology advances; significant delays in the collection of accounts or notes receivable; customer, counterparty, supplier or vendor defaults; changes in demand for, and production of, hydrocarbon products; inherent operating and litigation risks in gathering, transporting, handling and storing propane; costs of complying with, or liabilities imposed under, environmental, health and safety laws; the impact of pending and future legal proceedings; the interruption, disruption, failure or malfunction of our information technology systems including due to cyber-attack; economic and political instability, particularly in areas of the world tied to the energy industry, including the ongoing conflicts between Russia and Ukraine and in the Middle East; disruptions in the capital and credit markets, related to the evolving global tariff environment or otherwise; and access to available capital to meet our operating and debt-service requirements. These risks, uncertainties, and other factors also include those discussed in the Annual Report on Form 10-K of Ferrellgas Partners, L.P., Ferrellgas, L.P., Ferrellgas Partners Finance Corp., and Ferrellgas Finance Corp. for the fiscal year ended July 31, 2025, and in other documents filed from time to time by these entities with the Securities and Exchange Commission. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this release are made only as of the date hereof. Ferrellgas disclaims any intention or obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.
FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per unit data)
(unaudited)
Three months ended
Twelve months ended
October 31,
October 31,
2025
2024
2025
2024
Revenues:
Propane and other gas liquids sales
$
329,314
$
336,798
$
1,820,609
$
1,729,303
Other
25,875
27,287
108,832
100,885
Total revenues
355,189
364,085
1,929,441
1,830,188
Cost of sales:
Propane and other gas liquids sales
156,345
164,356
894,061
833,666
Other
3,685
4,446
12,688
12,486
Gross profit
195,159
195,283
1,022,692
984,036
Operating expense - personnel, vehicle, plant & other
149,765
148,174
632,425
605,130
Operating expense - equipment lease expense
4,192
5,504
17,408
21,713
Depreciation and amortization expense
25,220
24,325
99,321
98,392
General and administrative expense
12,014
137,926
52,705
175,440
Non-cash employee stock ownership plan compensation charge
916
853
3,206
3,367
Loss on asset sales and disposals
1,179
1,427
2,709
2,911
Operating income (loss)
1,873
(122,926
)
214,918
77,083
Interest expense
(26,651
)
(26,081
)
(108,634
)
(100,143
)
Loss on extinguishment of debt
(3,003
)
—
(3,003
)
—
Other income, net
583
857
2,670
4,012
