Mobile TeleSystems PJSC (NYSE:MBT) Q3 2019 Earnings Conference Call - Final Transcript
Nov 19, 2019 • 10:00 am ET
join action aimed in simplifying the rollout of artificial intelligence technology in Russia.
With that, I will hand it over to Vyacheslav.
Thank you, Alexey. In Q3, we continued to take steps to refresh our brand and enhance the user experience across the MTS ecosystem. Let me go over a few of the highlights. Few years ago, we launched our MTS cashback loyalty program and we are now focusing on rapidly expanding participation in line with our overall ecosystem strategy. We are seeing rapid progress. In Q3, we reached 4.2 million participants, and more recently in October, we passed a major milestone of 5 million registered users.
Our loyalty program is also a key enabler for us as we gain traction in data banking. In June, we launched cashback branded virtual debit and credit card products, and we are taking a digital-first approach to the consumer experience. In just a few clicks, the customer can apply for a virtual card, get approved and begin making purchases by Apple or Google Play. We are already seeing promising early results. And since the launch of our cashback cards, monthly issuance of virtual cards by the bank had more than doubled.
In Q3, we also continue to see growing adoption of our MyMTS app reaching over 19 million active users by the end of the quarter. MyMTS is our primary digital gateway for customer care, as well as a key ecosystem hub for cross-selling services. We're making good progress in driving penetration, which now is reaching a substantial share of our subscriber base.
Turning to entertainment, in Q3, we signed a 10-year branding agreement for a major new venue in Moscow, the MTS Live Arena. The new facility is planned to open its doors next year and we'll have a capacity of 11,500 people. From a product standpoint, this will be complementary to our live experiential services, including e-ticketing. This will also provide a flagship platform for brand positioning and product promotion for the 20 million residents of the Moscow Metro area.
Now, let me hand it over to Inessa for a business update.
Thank you, Vyacheslav.
Let me begin with Russia. Country revenue in Q3 grew 2.4% year-over-year to RUB121.9 billion. This was driven by our core connectivity business, as well as a strong contribution from MTS Bank. We saw double-digit top-line growth year-over-year. OIBDA in Russia grew 3.2% year-over-year to RUB57.3 billion with margin slightly increasing to 47%. As expected, organic mobile service revenue growth accelerated in Q3, reflecting ongoing price adjustments in the industry, as well as easy comps as regulatory headwinds began to moderate. Overall, our core performance is somewhat better than we expected at the beginning of the year.
Looking ahead, we're seeing that growth rates in Q4, will likely be at least comparable with Q3 dynamics.
Turning now to retail. As we forecasted earlier, in Q2, we had seen a significant slowdown in the Russian mobile device market. Against a higher base from retail ramp up last