MTS Announces First Quarter 2013 Financial Results

              MTS Announces First Quarter 2013 Financial Results

MTS Reports Operating Profit of $420,000; Operating Activities Generate $1.0
Million in Cash Flow in the First Quarter

The Company's Audit Committee and Board of Directors Approved an Update to the
Compensation Terms of Mr. Yaakov Goldman that are Equal to the Amounts Paid to
the Company's Outside Directors

PR Newswire

RA'ANANA, Israel, May 9, 2013

RA'ANANA, Israel, May 9, 2013 /PRNewswire/ --MTS – Mer Telemanagement
Solutions Ltd. (Nasdaq Capital Market: MTSL), a global provider of Mobile
Virtual Network Enabler (MVNE), Mobile Money and telecommunications expense
management (TEM) solutions and services, today announced its financial results
for the first quarter of 2013.

Revenues for the first quarter of 2013 were $3.3 million, compared with $3.0
million in revenues during the same quarter last year. The Company's operating
profit was $420,000 in the first quarter of 2013, compared to operating profit
of $280,000 in the first quarter of 2012. Net income in the first quarter was
$344,000, or $0.07 per diluted share, compared to net income of $310,000, or
$0.07 per diluted share, in the first quarter of 2012. As of March 31, 2013,
MTS had cash and marketable securities of $5.4 million as compared to $4.3
million as of December 31, 2012.

"Our first quarter results were in line with our expectations. The Company is
continuing to develop its Mobile Virtual Network Enabler (MVNE) activity and
to promote both this activity and the Company's Telecom Expense Management
products through partners, new customer acquisitions and expanding our
existing customer base. In parallel, we are closely monitoring our operating
expenses and we will make the necessary adjustments based on the business
needs and changes we see," said Eytan Bar, CEO of MTS.

The Company further announced today that in meetings held during May 2013, the
Company's audit committee and board of directors approved a resolution that
the compensation terms of Mr. Yaakov Goldman, a director and member of the
audit committee, be equal to the compensation terms of the Company's outside
directors, as defined under Israeli law.

Pursuant to the approval of the audit committee and board of directors,
effective May 8, 2013, Mr. Goldman will be entitled to receive an annual fee,
payable quarterly, of NIS 30,500 (currently approximately $8,500) and a per
meeting attendance fee of NIS 1,700 (currently approximately $470). He
previously received an annual fee of $16,800 and a per meeting fee of $400.
The Company's audit committee and board of directors determined that the
payment of the aforementioned sums to Mr. Goldman complies with the
requirement set forth in Regulation 1A(2) of the Israeli Companies Regulations
(Relief for Transactions with Interested Parties), 2000 (the "Relief
Regulations") as they do not exceed the maximum amounts applicable to the
compensation of the Company's outside directors pursuant to the terms of the
Israeli Companies Regulations (Rules regarding Compensation and Expense
Reimbursement of Outside Directors), 2000.

In accordance with Regulation 1C of the Relief Regulations, if one or more
shareholders holding at least one percent of the Company's issued share
capital or voting rights notifies the Company in writing of their objection to
the provision of this relief no later than fourteen days from publication of
this press release, the relief based on Regulation 1A(2) will not apply and
the change in the terms of Mr. Goldman's compensation will be subject to
approval by the Company's shareholders as required by the Israeli Companies
Law, 1999.

About MTS

Mer Telemanagement Solutions Ltd. (MTS) is a worldwide provider of Telecom
Expense Management (TEM) and Mobile Virtual Network Operators and Enablers
(MVNO/MVNE) and Mobile Money services and solutions used by mobile service
providers.

The MTS TEM Suite solution enables enterprises to gain visibility and control
of strategic fixed and mobile telecom assets, services and IT security
policies that drive key business processes and crucial competitive advantage.
The MTS cloud, consulting and managed services solutions -- including
integrated management of invoices, assets, wireless, optimization, usage,
mobile device management (MDM), procurement, help desk and bill payment ,along
with dashboards and reporting tools -- provide professionals at every level of
the organization with rapid access to concise, actionable data.

MTS's solutions for telecommunication service providers are used worldwide by
wireless and wireline service providers for interconnect billing, partner
revenue management and for charging and invoicing their customers. MTS
provides MVNE service to allow quick launch of new MVNO initiatives in a pay
as you grow and revenue share models. In addition, MTS has pre-configured
solutions to support emerging carriers of focused solutions (e.g. IPTV, VoIP,
WiMAX, MVNO) to rapidly install a full-featured and scalable solution.

Headquartered in Israel, MTS markets its solutions through wholly owned
subsidiaries in the United States, Hong Kong and distribution channels. MTS
shares are traded on the NASDAQ Capital Market (symbol MTSL). For more
information please visit the MTS web site: www.mtsint.com.

Certain matters discussed in this news release are forward-looking statements
that involve a number of risks and uncertainties including, but not limited
to, risks in product development plans and schedules, rapid technological
change, changes and delays in product approval and introduction, customer
acceptance of new products, the impact of competitive products and pricing,
market acceptance, the lengthy sales cycle, proprietary rights of the Company
and its competitors, risk of operations in Israel, government regulations,
dependence on third parties to manufacture products, general economic
conditions and other risk factors detailed in the Company's filings with the
United States Securities and Exchange Commission.

Contacts:
Company:
Alon Mualem
CFO
Tel: +972-9-7777-540
Email: Alon.Mualem@mtsint.com



CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
                                         March 31,         December 31,
                                         2013              2012
ASSETS
CURRENT ASSETS:
Cash and cash equivalents                $    5,261     $    4,190
Restricted cash                          440               38
Restricted marketable securities         141               139
Trade receivables, net                   886               1,066
Deferred income tax                      286               371
Other accounts receivable and prepaid    194               175
expenses
Total current assets                     7,208             5,979
LONG-TERM ASSETS:
Severance pay fund                       704               658
Other investments                        4                 4
Total long-term assets                   708               662
PROPERTY AND EQUIPMENT, NET              232               245
OTHER ASSETS:
Goodwill                                 3,479             3,479
Other intangible assets, net             709               759
Total other assets                       4,188             4,238
Total assets                             $     12,336  $      11,124



CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands (except share and per share data)
                                    March 31,           December 31,
                                    2013                2012
LIABILITIES AND SHAREHOLDERS'
EQUITY
CURRENT LIABILITIES:
Trade payables                      $      287    $       279
Accrued expenses and other          2,633               2,393
liabilities
Deferred revenues                   2,104               1,648
Liabilities of discontinued         435                 435
operations
Total current liabilities           5,459               4,755
LONG-TERM LIABILITIES
Accrued severance pay               852                 800
COMMITMENTS AND CONTINGENT
LIABILITIES
SHAREHOLDERS' EQUITY:
Share capital                       13                  13
Additional paid-in capital          20,224              20,120
Treasury shares                     (29)                (29)
Accumulated other comprehensive     13                  5
loss
Accumulated deficit                 (14,196)            (14,540)
Total shareholders' equity          6,025               5,569
Total liabilities and               $      12,336  $        11,124
shareholders' equity



CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except share and per share data)
                                          Three months ended

                                          March 31,
                                          2013               2012
Revenues:
Product sales                             $      595    $      833
Services                                  2,702              2,151
Total revenues                            3,297              2,984
Cost of revenues:
Product sales                             243                268
Services                                  908                817
Total cost of revenues                    1,151              1,085
Gross profit                              2,146              1,899
Operating expenses:
Research and development, net of grants   344                374
from the OCS
Selling and marketing                     588                524
General and administrative                794                721
Total operating expenses                  1,726              1,619
Operating income                          420                280
Financial income, net                     19                 32
Other income, net                         -                  -
Income before taxes on income             439                312
Taxes on income, net                      95                 2
Net income                               $       344  $       310
Net income per Ordinary share:
Basic and diluted net income per          $      0.07   $      0.07
Ordinary share
Weighted average number of Ordinary
shares used in computing basic net        4,639,899          4,459,057
 income per share
Weighted average number of Ordinary
shares used in computing diluted          4,784,153          4,466,034
 net income per share

SOURCE MTS - Mer Telemanagment

Website: http://www.mtsint.com