Capital Growth Systems (CGSY.OB) 8-K Other Events

Case No. 10-12302 PJW

Reporting Period: June 1 through June 30, 2011

Capital Growth Systems, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

For the month ended June 30,  2011

(Unaudited)

	For the month ended June 30, 2011
REVENUES	$	0
COST OF REVENUES		0
GROSS MARGIN		0
OPERATING EXPENSES
Compensation		20,000
Travel and entertainment		2,931
Occupancy		0
Professional services		1,611
Insurance		0
Bad Debt Expense		0
Depreciation & Amortization		0
Restructuring Expenses		0
Other expense (Income)	$	(176,542	)
TOTAL OPERATING EXPENSES		-152,000
OPERATING INCOME (LOSS)		152,000
Interest Expense (Income)		(301	)
(Gain) Loss on Sale of Assets and Assumption of Liabilities		178,794
Income Tax Expense		0
NET INCOME (LOSS)	$	(26,493	)

Case No.10-12302 PJW

Reporting Period: June 1 through June 30, 2011

Capital Growth Systems, Inc.and Subsidiaries

Condensed Consolidated Statements of Operations

For the six-month period ended June 30, 2011

(Unaudited)

	For the six-month period ended June 30, 2011
REVENUES	$	19,787,589
COST OF REVENUES		14,744,883
GROSS MARGIN		5,042,706
OPERATING EXPENSES
Compensation		3,807,392
Travel and entertainment		374,165
Occupancy		787,017
Professional services		404,806
Insurance		133,335
Bad Debt Expense		82,931
Depreciation & Amortization		911,617
Restructuring Expenses		1,258,788
Other Expense (Income)		-244,944
TOTAL OPERATING EXPENSES		7,515,107
OPERATING INCOME (LOSS)		(2,472,401	)
Interest Expense		6,468,809
(Gain) Loss on Sale of Assets and Assumption of Liabilities		(35,343,123	)
Income Tax Expense		90,453
NET INCOME (LOSS)	$	26,311,460

Case No.10-12302 PJW

Reporting Period: June 1 through June 30, 2011

Capital Growth Systems, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet

June 30, 2011

(Unaudited)

	June 30, 2011
ASSETS
CURRENT ASSETS
Cash	$	1,620,450
Accounts Receivable, net		0
Other Current Assets		3,426,620
Total Current Assets		5,047,070
Fixed Assets, gross		2,449,750
Accumulated Depreciation		(2,430,782	)
Fixed Assets, net		18,968
Other Assets		0
Intangible Assets		0
Goodwill		0
TOTAL ASSETS	$	5,066,038
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Current maturities of long-term debt	$	0
Post-Petition Accounts Payable		2,210,010
Pre-Petition Accounts Payable		0
Post-Petition Accrued Expenses		9,153,160
Pre-Petition Accrued Expenses		1,266,084
Deferred Revenue		0
Total Current Liabilities		12,629,254
Long-term debt		0
Taxes		0
Total Liabilities		12,629,254
SHAREHOLDERS' EQUITY (DEFICIT)
Common stock		17,015
Additional Paid in Capital		91,856,979
Retained Earnings, beginning of year		(125,359,811	)
Cumulative (gain) loss on currency translation		(388,859	)
Current Year Retained Earnings Inc/Loss		26,311,460
Total Equity		(7,563,216	)
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)	$	5,066,038

Case No. 10-12302 PJW

Reporting Period: June 1 through

June 30, 2011

Capital Growth Systems, Inc.

Consolidated AP Aging Report (post-petition)

As of 6/30/2011

	Current			31-60		61-90	Over 90		Total
Total Trade Accounts Payable	$	0	$	11,802	$	36,393	$	2,161,815	$	2,210,010

Case No. 10-12302 PJW

Reporting Period: June 1 through

June 30, 2011

Capital Growth Systems, Inc.

Consolidated AR Aging Report (Gross Receivables)

As of 6/30/2011

	Current		1-30 Days		31 - 60 Days			61+	Total
Total Trade Accounts Receivables	$	0	$	0	$	0	$	0	$	0