Bitauto Holdings Limited (NYSE:BITA) Q3 2018 Earnings Conference Call - Final Transcript

Nov 28, 2018 • 07:00 am ET


Bitauto Holdings Limited (NYSE:BITA) Q3 2018 Earnings Conference Call - Final Transcript


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Ladies and gentlemen, thank you for standing by, welcome to the Q3 2018 Bitauto's Holdings Limited Holdings Earnings Conference Call. At this time, all participants are in listen-only mode. There will be a presentation followed by question-and-answer session (Operator Instructions) I must advise you that this conference is being recorded today, Wednesday the 28 of November 2018.

I would now like to hand a conference with your host today. Thank you. Please go ahead.

Unidentified Speaker

Thank you. Welcome to Bitauto'a Third Quarter 2018 Earnings Conference Call. Speakers from the company today are Mr. Andy Zhang, CEO; Mr. Xiaoke Liu, COO and Mr. Ming Xu, CFO. After management's prepared remarks Andy, Xiaoke and Ming will be available to answer your questions. In addition Catherine Liu, CFO of Yixin will be available to answer your questions related to Yixin.

(Forward Looking Cautionary Statements) please refer to our earnings release which was issued earlier today for reconciliations of these non audited -- un-audited non-GAAP measures to the most directly comparable un-audited GAAP measures. As a reminder this conference call is being recorded. In addition a live and archived webcast of the conference will be available on our website.

I will now turn the call over to Andy Zhang, CEO.

Andy Zhang

Hello, everyone. Thank you for joining us for our third quarter 2018 earnings conference call. Despite softer new passenger car sales over the past few months, we were pleased to maintain healthy growth across our businesses in the third quarter of 2018, with total revenue rising 25.9% year-over-year to RMB2.72 billion.

In our advertising and subscription business, we achieved 7.7% year-over-year growth, with revenue reaching RMB1.06 billion in the third quarter of 2018. In particular, our core advertising and subscription business, which excludes contributions from subsidiaries in which we hold controlling interests, grew 14.9% year-over-year for the quarter. We also record higher sequential growth in our core subscription business compared with industry peers.

In our transaction services business, revenue saw steady growth of 39.6% year-over-year to RMB1.36 billion. In our digital marketing solutions business, revenue growth recovered in the third quarter, recording a 47.7% year-over-year increase to RMB305 million.

In our ad business, we continued to identify and develop new business areas, which we believe can be potential growth drivers for the long-term. For example, our collaborations with key opinion leaders to provide customized content and services for automakers continued to gain traction and we're extending this initiative to a larger group of self-media and automakers.

Moreover, our advertising revenue from new energy automakers was up nearly tenfold in the third quarter versus the same period last year. In our subscription business, we further optimized our business mix by converting more members to premium service packages with penetration of premium packages reaching 74%, up from 70 in the second quarter of 2018.

We also expanded our subscription membership base as we roll out tailored services to China's vast market of independent automobile dealers, an under-tapped segment of the auto dealer market in China. We currently cover