Global Capacity Reports Results for First Quarter 2010

CHICAGO, May 13 /PRNewswire-FirstCall/ -- Global Capacity (parent: Capital Growth Systems, Inc. (OTC Bulletin Board: CGSY)), the world's leading telecommunications information and logistics company, today announced its financial results for the first quarter ended March 31, 2010.

Total revenues were $14.7 million for first quarter 2010 compared to $16.2 million for first quarter 2009. This 9.3% decrease primarily reflects run rate reductions in revenue with a limited number of customers.  This activity was driven in part by customer and market uncertainty as the Company worked to resolve on-going disputes with a global service provider and the former senior lender to the Company, along with the proposed sale of limited assets that has since expired.  These factors detracted from organic growth momentum.

Connectivity Solutions recorded $12.1 million of first quarter 2010 Revenue compared to $13.3 million of first quarter 2009 Revenue, a 9% decrease. Connectivity Solutions for GAAP reporting purposes represents delivery of turnkey global networks and system management services. Optimization Solutions recorded $2.6 million of first quarter 2010 Revenue compared to $2.9 million of first quarter 2009 Revenue, a 10% decrease. 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 $3.7 million and 25% for first quarter 2010 compared to $3.9 million and 24% in the first quarter of 2009. Operating Expenses in the first quarter of 2010 decreased by $1.3 million compared to the first quarter of 2009, reflecting a 17% improvement. Positive operating results in the first quarter of 2010 versus the first quarter of 2009 included a reduction of $700,000 in compensation expenses, a reduction of $100,000 in professional services expenses, and a $500,000 decrease in depreciation and amortization.

For additional financial information regarding the Company, please refer to its Form 10-Q for the quarter ended March 31, 2010.

Investor Call

As announced previously, an investor call has been scheduled for May 13th, 2010 at 9:00 a.m. CST to review results for the first quarter ended 2010.

The conference call will be available to all interested parties through a web cast from the Company's web site or by phone at (888) 737-3703 for North American callers or +1 (913) 312-1481 for international callers; mention Global Capacity Earnings Call as the conference name. A replay of the conference call will be available through May 21, 2010 beginning two hours after the completion of the live call by phone at (888) 203-1112 for North American callers or +1 (719) 457-0820 for international callers (replay passcode: 8474438) as well as on the web at www.globalcapacity.com.

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, and carrier customers worldwide. Global Capacity is headquartered in Chicago, IL, with offices in the United States and the European Union. For more information, please visit www.globalcapacity.com or contact the Company at 312-673-2400.

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.