Sign in
FP

FERRELLGAS PARTNERS L P (FGPR)·Q3 2025 Earnings Summary

Executive Summary

  • Revenue rose 9% year over year to $560.85M, gross profit increased 6% to $289.23M, and net earnings attributable to FGPR grew 12% to $59.11M; Adjusted EBITDA increased 10% to $114.78M. Strength was driven by residential demand (+12% gallons) and solid retail/wholesale execution amid higher propane prices .
  • Retail sales increased $32.7M (+9%) and wholesale sales increased $9.9M (+8%) versus Q3 2024; total propane volumes rose 6% to 222.81M gallons in Q3 2025 .
  • Operating expenses rose $8.8M and interest expense increased $3.5M, reflecting legal/software costs, plant investments, fees tied to credit facility amendments, and lease-related interest for growth initiatives .
  • Capital structure remains a key near-term catalyst: management continues to work with Moelis on refinancing the $308.8M revolver (matures Dec 31, 2025) and $650.0M senior notes (due Apr 1, 2026), anticipating timely completion .
  • Consensus estimates from S&P Global were not available for EPS or revenue; relative performance should be evaluated vs prior periods and operational KPIs due to limited coverage for OTC-listed FGPR (values retrieved from S&P Global).

What Went Well and What Went Wrong

What Went Well

  • Strong demand and execution: “We are very pleased to have delivered strong third quarter sales growth of 9%, which translated into solid gross profit, and net earnings growth of 12%” .
  • Residential and Blue Rhino momentum: Q3 was 12% cooler vs prior year, aligning with a 12% increase in residential gallons; capital projects at Blue Rhino plants aim to improve efficiency and expand capabilities ahead of peak season .
  • Strategic wins and technology leverage: Six new national accounts (three-year deal) adding 1.6M gallons, plus four multi‑year contracts adding 0.8M gallons; telematics improved delivery metrics (unproductive deliveries, fill rates, zero-gallon/cylinder deliveries) .

What Went Wrong

  • Cost pressure and opex growth: Operating expense rose $8.8M (legal +$3.5M; software +$1.6M; capitalized tank installs/plant supplies +$1.0M; property maintenance +$0.8M); cost of product rose 12% from propane pricing, moderating gross margin expansion .
  • Higher interest expense: +$3.5M YoY driven by amortization of debt issuance costs tied to revolver amendments (+$1.9M), letter of credit fees (+$0.7M), and lease interest for a growth initiative (+$0.7M) .
  • Tariffs risk: Management is monitoring tariffs on steel tanks/cylinders and broader trade policy changes; while mitigations are in progress (supplier diversification, buying power), it remains a potential margin headwind .

Financial Results

Quarterly performance (Q1 → Q2 → Q3 FY2025)

MetricQ1 2025 (Oct 31, 2024)Q2 2025 (Jan 31, 2025)Q3 2025 (Apr 30, 2025)
Total Revenues ($USD)$364,085,000 $669,776,000 $560,847,000
Gross Profit ($USD)$195,283,000 $347,405,000 $289,229,000
Operating Income ($USD)$(122,926,000) $127,643,000 $87,290,000
Interest Expense ($USD)$(26,081,000) $(27,893,000) $(28,142,000)
Net Earnings Attributable to FGPR ($USD)$(146,668,000) $98,843,000 $59,105,000
Class A EPS ($)$(33.23) $2.40 $1.26
Adjusted EBITDA ($USD)$35,811,000 $157,040,000 $114,779,000

Year-over-year comparison (Q3 2024 → Q3 2025)

MetricQ3 2024Q3 2025
Total Revenues ($USD)$515,774,000 $560,847,000
Gross Profit ($USD)$272,298,000 $289,229,000
Operating Income ($USD)$76,739,000 $87,290,000
Interest Expense ($USD)$(24,685,000) $(28,142,000)
Net Earnings Attributable to FGPR ($USD)$52,766,000 $59,105,000
Class A EPS ($)$(13.13) $1.26
Adjusted EBITDA ($USD)$104,003,000 $114,779,000

Segment and volumes

KPIQ1 2025Q2 2025Q3 2025
Retail Gallons (000s)106,731 205,975 171,084
Wholesale Gallons (000s)51,240 69,490 51,723
Total Gallons (000s)157,971 275,465 222,807

KPIs and cash flow

KPIQ1 2025Q2 2025Q3 2025
Net Cash Interest Expense ($USD)$(22,473,000) $(23,431,000) $(23,384,000)
Maintenance Capex ($USD)$(10,414,000) $(8,727,000) $(6,365,000)
DCF Attributable to Class A & B ($USD)$(12,897,000) $106,469,000 $68,300,000
DCF Excess/(Shortage) ($USD)$(12,897,000) $106,469,000 $68,300,000

Guidance Changes

MetricPeriodPrevious GuidanceCurrent Guidance/CommentaryChange
Revolving Credit Facility ($308.8M)Matures Dec 31, 2025Fifth amendment extended maturity (Dec 31, 2025) and reduced commitment to $308.8M effective Mar 31, 2025 Management working with Moelis on refinancing and anticipates timely completion Maintained; timing clarified
Senior Unsecured Notes ($650.0M)Due Apr 1, 2026Callable at par post-March 2025; monitoring HY market Anticipates timely refinancing alongside revolver Maintained; reiterated intent
Distributions to Class A UnitholdersOngoingNo distributions paid in FY2024/FY2025 No change disclosed Maintained
Operational Initiatives (Telematics, Blue Rhino capacity)FY2025Ongoing investments in fleet telematics and plant efficiency Continued execution; Q3 delivery metrics improved; Blue Rhino plant upgrades underway Raised execution detail (qualitative)
Legal/Eddystone Settlement2025–2026$125M accrued in Q1; cash payments: $50M Jan 15, 2025; $37.5M Jun 16, 2025; $37.5M Jan 15, 2026 Appeal bond/L/Cs released; payments supported by L/Cs Maintained plan; execution progressing

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 FY2025)Current Period (Q3 FY2025)Trend
Telematics & EfficiencyTelematics reduced idling/fuel; improved logistics and safety; Q2 “days to set a tank” improved 25% Full year in place; improved delivery metrics (unproductive, fill rates, zero-gallon/cylinder) Continuing improvement
Weather & DemandQ1 storms (Helene/Milton) with Southeast double-digit growth; Q2 Jan 12.2% cooler than normal; record Blue Rhino January Q3 4% warmer than normal, but 12% cooler YoY; residential gallons +12% Supportive YoY; mixed vs normal
Tariffs/TradeLimited explicit Q1/Q2 commentary; focus on supply planning Monitoring tariffs on steel tanks/cylinders; diversifying suppliers; leveraging buying power Emerging risk; mitigation underway
Capital Structure/RefinancingRevolver extended; Moelis engaged; notes callable at par post‑Mar 2025 Anticipates timely refinancing; reiterated on call and in release Active; near‑term catalyst
Blue Rhino PerformanceQ1: best quarter for FCF; organic growth from new locations; Q2: record January; 6,000 added locations Q3: preparing for peak season; plant upgrades; steady demand Seasonal build; capacity expansion
Acquisitions/National AccountsQ1: Kilhoffer tuck‑in; three national account wins (700k gallons annually) Q3: six new national accounts (1.6M gallons); four multi‑year contracts (0.8M gallons) Ongoing tuck‑in/contract wins
CFO TransitionCFO active in Q1/Q2; investor outreach/JPM HY conf CFO retirement effective May 2, 2025; search underway; IR responsibilities expanded Leadership transition

Management Commentary

  • “We are very pleased to have delivered strong third quarter sales growth of 9%, which translated into solid gross profit, and net earnings growth of 12%” — Tamria Zertuche, President & CEO .
  • “Impactful capital projects began at several Blue Rhino production plants to improve efficiency and expand capabilities as we modernize operations and make investments to serve customer demands” .
  • “The Company gained six new national account customers through a three‑year deal… expected to add a cumulative 1.6 million gallons… [and] four additional multi‑year contracts, adding a cumulative 0.8 million gallons” .
  • “We remain committed to proactively adapt to evolving trade conditions with a focus on minimizing disruption and improving financial performance” (tariffs) .
  • “We anticipate completing a refinancing in a timely manner” (capital structure) .

Q&A Highlights

  • Capital structure and refinancing: Management reiterated active engagement with Moelis and intent to complete refinancing “in a timely manner,” with notes callable at par and continued monitoring of HY markets .
  • CFO transition: CFO retirement confirmed; search underway; IR responsibilities expanded to maintain continuity in investor communications .
  • Tariffs mitigation: Focus on continuous improvement, supplier diversification, and logistics buying power to offset tariff impacts on steel tanks/cylinders .
  • Class B units mechanics: Prior quarter Q&A outlined redemption vs conversion paths and estimated redemption value mechanics; emphasized document complexity for investor diligence .

Estimates Context

  • Wall Street consensus for Q3 2025 EPS and revenue was not available for FGPR; S&P Global shows no active consensus estimates or estimate counts for the quarter (OTC listing limits coverage). Values retrieved from S&P Global.
MetricQ3 2025 Consensus# of Estimates
Primary EPS Consensus MeanN/A*0*
Revenue Consensus MeanN/A*0*

Values retrieved from S&P Global.

Key Takeaways for Investors

  • Q3 execution was solid with revenue (+9% YoY), gross profit (+6% YoY), net earnings (+12% YoY), and Adjusted EBITDA (+10% YoY) growth; residential demand and retail/wholesale volumes underpin operating momentum into peak grilling season .
  • Operating and legal/software spend elevated opex (+$8.8M) and interest (+$3.5M); watch for opex normalization and interest trajectory as refinancing progresses .
  • Blue Rhino capacity upgrades and strong summer seasonality are near-term topline/cash flow drivers; plant efficiency gains should support margins and inventory turns .
  • Capital structure is the primary catalyst: revolver and senior notes refinancing targeted in a “timely manner”; announcements on terms, costs, and Class B resolution could drive sentiment .
  • No Class A distributions; cash flow is being retained for reserves, debt reduction, and capex—DCF trends improved materially in Q2–Q3, supporting balance sheet priorities .
  • Tariffs and propane price volatility remain cost risks; mitigations (supplier diversification, logistics scale) aim to buffer impacts—monitor for any margin effects .
  • Leadership transition (CFO retirement) and enhanced IR coverage maintain continuity; expect continued outreach and potentially conference participation as refinancing milestones approach .