SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
                                                         

FORM 6-K
 
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
 
For the month of March 2020
 
MER TELEMANAGEMENT SOLUTIONS LTD.
(Name of Registrant)
 
15 Hatidhar Street, Ra'anana 43665, Israel
 (Address of Principal Executive Office)
 
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒          Form 40-F ☐
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
 
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
 
Yes ☐           No ☒

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- __________
 
This Form 6-K is being incorporated by reference into the Registrant’s Form S-8 Registration Statements File Nos. 333-123321 and 333-180369.



SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
MER TELEMANAGEMENT SOLUTIONS LTD.
(Registrant)
 
       

By:
/s/ Roy Hess  
    Roy Hess  
    Chief Executive Officer  
       
 
Date: March 24, 2020




MTS Announces 2019 fourth quarter Financial Results

Ra’anana, Israel / Powder Springs, Georgia, USA - March 24, 2020 - Mer Telemanagement Solutions Ltd. (MTS) (Nasdaq Capital Market: MTSL), a global provider of telecommunications expense management (TEM), call accounting and contact center software, today released its financial results for the three and twelve months ended December 31, 2019.

The Company recorded revenues of $1.4 million for the three months ended December 31, 2019, compared with $1.6 million for the three months ended December 31, 2018. The Company recorded net income of $99,000 for the three months ended December 31, 2019, or $0.02 per diluted share, compared with net income of $110,000, or $0.03 per diluted share, for the comparable period in 2018. In the three months ended December 31, 2019, the Company had net income from continuing operations of $46,000 compared to net income from continuing operations of $48,000 in the comparable period in 2018. The Company recognized net income from discontinued operations of $53,000 in the three months ended December 31, 2019, compared to net income from discontinued operations of $62,000 in the comparable period in 2018.

The Company recorded revenues of $5.2 million for the year ended December 31, 2019, compared with $5.9 million for the comparable period in 2018. The Company incurred a net loss of $(135,000), or $(0.03) per diluted share, for the year ended December 31, 2019, compared with a net loss of $(1.2) million, or ($0.34) per diluted share, in the comparable period in 2018. Net loss from continuing operations was $(192,000) for the year ended December 31, 2019, compared with a net loss from continuing operations of $(886,000) in the comparable period in 2018. On a non-GAAP basis (as described and reconciled below), the Company had net income from continuing operations of $79,000, or $0.02 per diluted share, for the year ended December 31, 2019, compared with a net loss from continuing operations of $(776,000), or $(0.23) per diluted share, for the comparable period in 2018.

During 2018, an institutional investor invested $1.5 million in a newly created class of convertible preferred shares and $0.2 million in ordinary shares of the Company, at a price per preferred share and ordinary share of $1.14. The preferred shares are convertible into ordinary shares on a one to one basis.

As previously published, the share purchase agreement with the institutional investor includes a greenshoe option, exercisable until April 30, 2020, for future investment of up to $1.5 million in the Company’s preferred shares at a price per preferred share of $1.14. During 2019, the institutional investor partially exercised its greenshoe option and purchased 692,983 convertible preferred shares in consideration for $790,000.



Commenting on the results, Mr. Roy Hess, Chief Executive Officer of MTS, said, “Our results in 2019 reflect the efficiency plan we implemented during 2019 in order to adjust our expenses to our new line of business and to improve our operation margins. We recently entered the field of omnichannel contact center software. In June 2019, we introduced Omnis - Contact Center Software with “Out-Of-The-Box” capabilities and open channel architecture. During the end of 2019 we started to see initial revenues from this new product, which we consider to be our main growth engine in the coming years. As previously reported, we are also continuing our efforts to find  a suitable M&A candidate for our company which will enhance shareholder value.”

About MTS

Mer Telemanagement Solutions Ltd. (MTS) is focused on innovative products and services for enterprises in the area of telecom expense management (TEM), call accounting and contact center software. Headquartered in Israel, MTS markets its solutions through wholly-owned subsidiaries in Israel, the U.S. and Hong Kong, as well as through distribution channels. For more information please visit the MTS web site: www.mtsint.com.

Forward Looking Statements
Certain matters discussed in this news release are forward-looking statements that involve a number of risks and uncertainties including, but not limited to, the Company’s ability to achieve  profitable operations, its ability  to continue to operate as a going concern, its ability to continue to meet NASDAQ continued listing requirements,  customer acceptance of new products, the effects of the spread of Coronavirus (COVID-19) and future measures taken by authorities in the countries in which we operate on our operations, the demand for our products and our customers’ economic condition, 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,  general economic conditions and other risk factors detailed in the Company’s annual report and other filings with the United States Securities and Exchange Commission.

Contacts:
 
Ofira Bar
CFO
Tel: +972-9-7777-540
Email: ofira.bar@mtsint.com          



CONSOLIDATED BALANCE SHEET

U.S. dollars in thousands

   
December 31,
 
   
2019
   
2018
 
   
Unaudited
   
Audited
 
ASSETS
           
             
CURRENT ASSETS:
           
Cash and cash equivalents
 
$
1,732
   
$
1,150
 
Restricted cash
   
1,464
     
1,380
 
Trade receivables (net of allowance for doubtful accounts of $65 at December 31, 2019 and 2018)
   
499
     
604
 
Other accounts receivable and prepaid expenses
   
236
     
101
 
Assets of discontinued operations
   
172
     
187
 
                 
Total current assets
   
4,103
     
3,422
 
                 
SEVERANCE PAY FUND
   
653
     
541
 
                 
PROPERTY AND EQUIPMENT, NET
   
62
     
60
 
                 
OTHER ASSETS:
               
Intangible assets, net
   
-
     
21
 
Goodwill
   
3,225
     
3,479
 
                 
Total other assets
   
3,225
     
3,500
 
                 
Total assets
 
$
8,043
   
$
7,523
 




CONSOLIDATED BALANCE SHEET

U.S. dollars in thousands (except share and per share data)

   
December 31,
 
   
2019
   
2018
 
   
Unaudited
   
Audited
 
LIABILITIES AND SHAREHOLDERS' EQUITY
           
             
CURRENT LIABILITIES:
           
Trade payables
 
$
149
   
$
164
 
Deferred revenues
   
962
     
1,053
 
Accrued expenses and other liabilities
   
2,317
     
2,394
 
Liabilities of discontinued operations
   
516
     
606
 
                 
Total current liabilities
   
3,944
     
4,217
 
                 
LONG-TERM LIABILITIES:
               
Accrued severance pay
   
831
     
722
 
Deferred tax liability
   
163
     
181
 
                 
Total long-term liabilities
   
994
     
903
 
                 
COMMITMENTS AND CONTINGENT LIABILITIES
               
                 
SHAREHOLDERS' EQUITY:
               
Share capital -
               
Ordinary shares of NIS 0.03 par value: Authorized: 17,000,000 shares at December 31, 2019 and 2018; Issued: 3,614,208 and 3,296,123 shares at December 31, 2019 and 2018, respectively; Outstanding: 3,612,408 and 3,294,323 shares at December 31, 2019 and 2018, respectively
   
30
     
27
 
Preferred Shares of NIS 0.03 par value: Authorized: 3,000,000 shares at December 31, 2019 and 2018; Issued and Outstanding: 2,008,772 and 1,315,789 shares at December 31, 2019 and 2018, respectively
   
16
     
10
 
Additional paid-in capital
   
30,635
     
29,807
 
Treasury shares at cost (1,800 Ordinary shares at December 31, 2019 and 2018)
   
(29
)
   
(29
)
Accumulated deficit
   
(27,547
)
   
(27,412
)
                 
Total shareholders' equity
   
3,105
     
2,403
 
                 
Total liabilities and shareholders' equity
 
$
8,043
   
$
7,523
 




CONSOLIDATED STATEMENTS OF OPERATIONS

U.S. dollars in thousands (except share and per share data)

   
Twelve months ended
December 31,
   
Three months ended
December 31,
 
   
2019
   
2018
   
2019
   
2018
 
   
Unaudited
   
Audited
   
Unaudited
   
Audited
 
Revenues:
                       
Services
 
$
4,273
   
$
4,843
   
$
1,079
   
$
1,230
 
Product sales
   
920
     
1,018
     
274
     
323
 
                                 
Total revenues
   
5,193
     
5,861
     
1353
     
1553
 
                                 
Cost of revenues:
                               
Services
   
1,486
     
1,719
     
336
     
420
 
Product sales
   
371
     
430
     
83
     
105
 
                                 
Total cost of revenues
   
1,857
     
2,149
     
419
     
525
 
                                 
Gross profit
   
3,336
     
3,712
     
934
     
1028
 
                                 
Operating expenses:
                               
Research and development
   
545
     
825
     
137
     
153
 
Selling and marketing
   
817
     
1,471
     
253
     
276
 
General and administrative
   
2,144
     
2,239
     
465
     
484
 
                                 
Total operating expenses
   
3,506
     
4,545
     
855
     
913
 
                                 
Operating income (loss)
   
(170
)
   
(823
)
   
79
     
115
 
Financial income (expenses), net
   
(18
)
   
(17
)
   
9
     
(18
)
                                 
Income (loss) before taxes on income
   
(188
)
   
(840
)
   
88
     
97
 
Taxes on income, net
   
4
     
46
     
42
     
49
 
                                 
Net income (loss) from continuing operations
   
(192
)
   
(886
)
   
46
     
48
 
Income (loss) from discontinued operations
   
57
     
(284
)
   
53
     
62
 
Net income (loss)
 
$
(135
)
 
$
(1,170
)
 
$
99
   
$
110
 
                                 
Net loss per share:
                               
Basic and diluted net profit (loss) per share from continuing operations
 
$
(0.04
)
 
$
(0.26
)
 
$
0.01
   
$
0.02
 
Basic and diluted net profit (loss) per share from discontinued operations
   
0.01
     
(0.08
)
   
0.01
     
0.01
 
Basic and diluted net loss per share
 
$
(0.03
)
 
$
(0.34
)
 
$
0.02
   
$
0.03
 
Weighted average number of shares used in computing basic and diluted net profit (loss) per share
   
5,013,374
     
3,435,161
     
5,444,806
     
4,200,755
 




RECONCILIATION OF GAAP TO NON-GAAP RESULTS

U.S. dollars in thousands (except share and per share data)

   
Twelve months ended
December 31,
   
Three months ended
December 31,
 
   
2019
   
2018
   
2019
   
2018
 
   
Unaudited
   
Unaudited
   
Unaudited
   
Unaudited
 
                         
GAAP net income (loss) from continuing operations
   
(192
)
   
(886
)
   
46
     
48
 
Stock-based compensation expenses
   
47
     
89
     
8
     
22
 
Intangible assets amortization, net of tax effects
   
21
     
21
     
6
     
6
 
Goodwill impairment, net of tax effect
   
203
     
-
     
-
     
-
 
                                 
Non-GAAP net income (loss)
 
$
79
   
$
(776
)
 
$
60
   
$
76
 
                                 
Net loss per share:
                               
                                 
GAAP basic and diluted net profit (loss) per share)
 
$
0.04
   
$
(0.26
)
 
$
0.01
   
$
0.02
 
Non-GAAP basic and diluted net profit (loss) per share
 
$
0.02
   
$
(0.23
)
 
$
0.11
   
$
0.02
 
Weighted average number of shares used in computing non-GAAP basic and diluted net profit (loss) per share
   
5,013,374
     
3,435,161
     
5,444,806
     
4,200,755