What drove WTTR's earnings growth in Q3?

Select Water Solutions, Inc. (WTTR) experienced earnings growth in Q3 due to several key factors:

1. **Revenue Growth in Water Infrastructure Segment**: The Water Infrastructure segment saw an 8% sequential revenue improvement, which contributed to the overall revenue growth. This increase in revenue was driven by the company's successful strategy of expanding its pipeline gathering, recycling, and disposal infrastructure projects in the Permian Basin. The anticipated new capital deployment of $55 million to $60 million for these projects indicates a strong commitment to growth and profitability.
2. **Margin Improvement and Profitability**: WTTR's focus on improving margins and profitability was evident in the 17% growth in gross profit before D&A in the Water Infrastructure segment. This improvement in margins, coupled with strong free cash flow of $37.4 million during the quarter, demonstrates the company's ability to generate profits while maintaining financial discipline.
3. **Strategic Acquisitions and Integration**: The company's acquisition of disposal assets and operations in the Northeast for $9 million of cash consideration has been integrated efficiently, contributing to the growth in earnings. The ability to integrate acquired assets into the portfolio and reach profitability targets ahead of plan is a testament to WTTR's operational excellence.
4. **Beat of Earnings Estimate**: WTTR reported quarterly earnings of $0.13 per share, surpassing the Zacks Consensus Estimate of $0.11 per share. This beat of earnings estimate reflects the company's operational efficiency and market conditions.

In conclusion, WTTR's earnings growth in Q3 was driven by revenue growth in its Water Infrastructure segment, margin improvement, strategic acquisitions, and operational efficiency. These factors combined to deliver strong financial results and reinforce the company's position in the energy industry.