CHICAGO, Nov. 16, /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 quarter ended September 30, 2009. The Company reported revenues of $16.5 million compared to revenues of $5.8 million in the third quarter of 2008, an increase of 184% driven by the acquisition of VDUL in the fourth quarter of 2008. The Company was also able to improve consolidated gross margin for the quarter to 24%, an increase of 3% from the 21% gross margin achieved in the second quarter of this year. This increase is primarily due to the expansion and validation of the "One Marketplace" network.
The 24% gross margin for the quarter ended September 30, 2009 was down compared to the 31% gross margin for the same period in 2008. This decrease is due to the heavier weighting of the connectivity business in 2009, which is a result of the acquisition of Vanco Direct USA, LLC, as well as the Company's focus on One Marketplace. Within the connectivity business, margin increased 213% to $2.5 million from $0.8 million from the same period 2008.
Total revenues for the nine-month period ended September 30, 2009 were $48.6 million compared to $24.0 million for the same period in 2008, representing a 103% increase. During the first nine months of 2009, professional services, which are mainly non-recurring expenses relating to one-time Company events, decreased 14% from $5.8 million to $5.0 million in 2009. The Company continues to review all cost categories for additional savings.
"The third quarter of 2009 has been a period of continued growth for Global Capacity, further building on the strength of our consolidated product portfolio. The Company has achieved 184% period over period growth in our top line, demonstrating strong market need for our cost saving offerings," said Patrick Shutt, Global Capacity's Chief Executive Officer. "The expansion of Global Capacity's 'One Marketplace' and the launch of the 'GCPrice' SaaS offering are examples of the unique approach the Company takes to solving customer problems, creating a strong platform to drive revenue growth and margin improvement going forward."
Additional Highlights:
- $7.8 million of Total Contract Value sales in the third quarter along with a significant uptick of potential deals in the sales pipeline
- A two year SaaS contract with Cavalier, providing an automated pricing tool that will help streamline their back office operations
- Expansion of the "One Marketplace" network with $2.9 million in new contracts
- Global launch of GCPrice, an additional product in Global Capacity's portfolio of SaaS applications
- RMS contracts with Geckotech and MIT
- 36-month software contract with Core180
For additional financial information regarding the Company, please refer to its Form 10-K for the year ended December 31, 2008 and Forms 10-Q for the first three quarters of 2009.
Investor Call
As announced previously, an investor call has been scheduled for November 16, 2009 at 9:00 a.m., CST, to review results for the third quarter of 2009.
The investor call will be available to all interested parties through a webcast from the Company's website or by phone at: 888-204-6674 for North American callers or 913-312-0666 for international callers. Please mention "Global Capacity Reports Financial Results for Third Quarter 2009." A replay of the investor call will be available through November 23, 2009, beginning two hours after the completion of the call by phone at: 888-203-1112 for North American callers or 719-457-0820 for international callers (replay passcode: 6431339) 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 operational centers in Waltham, MA and Manchester, England; and with offices in Houston, TX; Glastonbury, CT; New York, NY; London, England; and Lisbon, Portugal. 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.
www.globalcapacity.com
SOURCE Global Capacity
