Global Capacity Reports Results for Second Quarter 2010

CHICAGO, Aug. 10 /PRNewswire-FirstCall/ -- Global Capacity, Inc. (parent: Capital Growth Systems, Inc. (OTC Bulletin Board: CGSYQ)), the leading telecommunications information and logistics company, today announced its financial results for the second quarter ended June 30, 2010.

Total revenues were $13.9 million for second quarter 2010 compared to $15.9 million for second quarter 2009. This 12.6% decrease is primarily due to disconnects from three major customers resulting from a shift in customer circuitry strategy. Connectivity Solutions recorded $12.5 million of second quarter 2010 Revenue compared to $13.0 million of second quarter 2009 Revenue. Connectivity Solutions for GAAP reporting purposes represents delivery of turnkey global networks and system management services. Optimization Solutions recorded $1.4 million of second quarter 2010 Revenue compared to $2.9 million of second quarter 2009 Revenue. Optimization Solutions for GAAP reporting purposes represents optimization consulting, automated pricing software, remote management services, and professional engineering services.

Global Capacity's consolidated gross margin was $3.3 million and 24% for second quarter 2010 compared to $3.3 million and 21% in the second quarter of 2009. The increase in gross margin percentage is consistent with full year 2009 gross margin percentage of 24%, as reported in the Company's Form 10-K for 2009.  

Operating Expenses decreased by $1 million, from $7 million in the second quarter of 2009 to $6 million in the second quarter of 2010, a 15.1% reduction.  

For additional financial information regarding the Company, please refer to its Form 10-Q for the quarter ended June 30, 2010.

Investor Call

An Investor Call will be announced in a separate press release to review results for the second quarter ended June 30, 2010. The conference call will be available to all interested parties through a web cast from the Company's web site or by phone.

Restructuring

For information regarding the Company's financial restructuring, interested parties can visit the United States Trustee's public web site (https://ecf.deb.uscourts.gov/) to view all filings made to date. The case is Global Capacity Group, Inc. case number 10-12303, filed in the District of Delaware on July 23, 2010. A password is required to access this site; if you do not have a password, please contact Global Capacity's restructuring counsel, Heller, Draper, Hayden, Patrick, & Horn, L.L.C. ("Heller Draper"). All inquiries should be directed to Leslie Collins, Esq., [email protected], of Heller Draper.

About Global Capacity

Global Capacity (parent: Capital Growth Systems, Inc.) is a telecom information and logistics company providing a fully integrated telecommunications supply chain management system that streamlines and accelerates the process of designing, pricing, building, optimizing, and managing customized communications networks. It offers a comprehensive suite of services to enterprises, systems integrators, governments and carrier customers worldwide. Global Capacity has offices in the United States and the European Union. For more information, please visit www.globalcapacity.com or contact the Company at [email protected] .

Forward-Looking Statements

Certain information discussed in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Federal securities laws. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, it can give no assurance that its expectations will be achieved. Readers are cautioned not to place undue reliance on these forward-looking statements.

Forward-looking statements are inherently subject to unpredictable and unanticipated risks, trends, and uncertainties such as: the Company's inability to accurately forecast its operating results; uncertainty as to the volume of business or level of profitability of network optimization contracts; the Company's potential ability to achieve profitability or generate positive cash flow; the availability of financing; the risks associated with procuring a listing of its securities on one or more public stock markets; and other risks associated with the Company's business. For further information on factors which could impact the Company and its subsidiaries and the statements contained herein, reference should be made to the Company's filings with the Securities and Exchange Commission, including annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

SOURCE Global Capacity, Inc.

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