(Logo: http://www.newscom.com/cgi-bin/prnh/20010807/FLTU015LOGO )    First Quarter Highlights    - Revenues $3.4 million   - Book-to-bill substantially higher than one; order backlog     grows for second consecutive quarter   - Gross margin reaches 44%, similar as first quarter 2008 and     up from 34% in fourth quarter 2008   - Non-GAAP operating loss narrows to $1.6 million; GAAP     operating loss narrows to $1.8 million   - Positive impact of comprehensive efficiency measures,     stronger US dollar and reversal of provisions   - Reiterate aim to achieve non-GAAP breakeven in the second     half of 2009    Financial Results  

Revenues for the first quarter of 2009 totaled $3.4 million, compared to $6.5 million in the first quarter of 2008, and $4.8 million in the fourth quarter 2008. Despite strong bookings during the first quarter, revenues continued to be impacted by the longer product implementation cycles.

Gross margin for the first quarter 2009 totaled to 44%, compared to the 44% in the first quarter of 2008, and 34% margin in the fourth quarter 2008.

Non-GAAP operating loss for the first quarter of 2009 totaled $1.6 million, compared to a non-GAAP operating loss of $1.8 million in the first quarter of 2008 and a $3.0 million non-GAAP operating loss in the fourth quarter of 2008. Non-GAAP operating results were positively impacted by initial savings on the efficiency plan instituted in the fourth quarter of last year, a stronger US dollar and the reversal of accounting provisions, mainly for 2008 bonuses which were ultimately not distributed. The non-GAAP net loss for the first quarter of 2009 totaled $1.4 million, or $0.09 per share, compared with a non-GAAP net loss of $1.1 million, or $0.07 per share, in the first quarter of 2008. Non-GAAP net loss for the fourth quarter 2008 totaled $2.9 million, or $0.18 per share.

GAAP operating loss for the first quarter of 2009 totaled $1.8 million, compared to an operating loss of $2.0 million in the first quarter of 2008 and an operating loss of $3.2 million for the fourth quarter of 2008. GAAP net loss for the first quarter of 2009 totaled $1.6 million, or $0.10 per share, compared to a net loss $1.3 million or $0.08 per share in the first quarter of 2008. Net loss for the fourth quarter 2008 totaled $3.4 million or $0.21 per share.

Cash, cash equivalents, and marketable bonds and securities as of March 31, 2009 were $14.8 million or $0.91 per share, compared to $17.6 million or $1.08 per share as of December 31, 2008.

ECtel's non-GAAP net income differs from results reported under U.S. GAAP. This is due to adjustments made for amortization of acquisition related intangible assets, share-based compensation expenses, and the impact of the permanent impairment charge and recovery related to certain securities in December 2007 and 2008. The accompanying tables provide a full reconciliation from GAAP to Non-GAAP results.

"The current environment and need for revenue assurance and management solutions is supporting continuing demand for our products, although we are experiencing longer product implementation cycles with customers" commented Itzik Weinstein, President and CEO of ECtel. "Revenues for the quarter were on the lower end of expectations. However, the strong pickup in demand enabled us to meet booking targets with five new customers choosing our products, a key achievement in the current climate, with book to bill totaling at well over one."

"While our firm order backlog grew significantly this quarter, the macro climate took its toll on certain of our customers resulting in payment collection issues. We believe that payment will be received during this year, and are therefore working closely with our customers to help them navigate their liquidity issues," added Mr. Weinstein. "Looking ahead, we aim to leverage this growing demand to increase backlog and visibility. We remain committed to meet our goal of achieving non-GAAP break-even in the second half of 2009, both as the recent orders translate into revenues, and as we continue to very prudently manage expenses, while preserving cash where possible."

Conference call

ECtel management will host a teleconference later today at 10:00 am ET (9:00am CT, 7:00am PT, and 5:00pm Israel time) to discuss its first quarter results. Itzik Weinstein President & CEO and Mickey Neumann, Senior Vice President & CFO will co-host the call. To participate in the call, please dial one of the following numbers:

   From the United States:            1-866-345-5855   From Israel:                       03-918-0610   From the United Kingdom:           0800-4048-418   All other international callers:   +972-3-918-0610    

A Webcast replay of the earnings call will be available after the call on the Company's web site at: http://www.ectel.com/.

About ECtel Ltd.

ECtel is a leading global provider of Integrated Revenue Management(TM) (IRM(TM)) solutions for communications service providers. A pioneering market leader for nearly 20 years, ECtel offers carrier-grade solutions that enable wireline, wireless, converged and next generation operators to fully manage their revenue and cost processes. ECtel serves prominent Tier One operators, and has more than 100 implementations in over 50 countries worldwide. Established in 1990, ECtel maintains offices and presence in the Americas, Europe and Asia. For more information, visit http://www.ectel.com/

ECtel Forward-Looking Statement

Certain statements contained in this release contain forward-looking information with respect to plans, projections or future performance and products of the Company, the occurrence of which involves certain risks and uncertainties. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that our expectations will be obtained or that any deviations will not be material.