10-K: Cluster Group Holdings 2025 Annual Report

Cluster Group Holdings Limited Co. reports no revenue and ongoing operational losses while continuing its search for a merger candidate in the food industry.

Summary

• The company remains a non-operating entity focused on identifying a merger or acquisition target within the food industry.
• Reported a net loss of $52,013 for the fiscal year ended December 31, 2025, compared to a $58,459 loss in 2024.
• The company has no revenue and relies on advances from its officer and director for working capital.
• A 1-for-100,000 reverse stock split was effective January 28, 2025, alongside a name change from China Teletech Holding, Inc. to Cluster Group Holdings Limited Co.
• The company's auditors have issued a going concern opinion due to recurring losses and lack of capital.

Sentiment

Score: 2

Explanation: StockSavvy.ai views this as a high-risk, speculative situation. The company is a non-operational shell with no revenue, significant internal control weaknesses, and a reliance on related-party debt to survive.

Positives

• Successfully settled an $80,000 outstanding payable to a related party through the issuance of common stock, reducing debt obligations.
• Maintained compliance with SEC reporting requirements for the fiscal year.

Negatives

• The company has generated no revenue for the last two fiscal years.
• Management identified material weaknesses in internal controls over financial reporting, including a lack of an audit committee and inadequate segregation of duties.
• The company has no cash balance as of December 31, 2025.
• The company is dependent on advances from its sole officer to fund basic operating expenses.

Risks

• Substantial doubt regarding the company's ability to continue as a going concern.
• High degree of speculative risk as the company has no current operations or revenue-generating business.
• Significant concentration of voting control held by a single shareholder, Chiching Hung, via Series D Preferred Stock.
• Potential for substantial dilution of existing shareholders if additional shares are issued to fund future acquisitions.
• Regulatory and geopolitical risks associated with operations and management presence in China and Hong Kong.
• Limited liquidity and sporadic trading volume for the company's common stock on the OTC Pink Sheets.

Future Outlook

The company intends to continue searching for a merger or acquisition target in the food industry, including food products and distribution channels. It expects to incur ongoing losses until a suitable transaction is completed and requires additional capital to fund operations.

Management Comments

• Management acknowledges that the company is in the development stage and currently lacks the resources to implement its business plan without additional funding.
• The company is actively seeking a suitable merger candidate and evaluating potential targets that align with its business needs.

Industry Context

StockSavvy.ai notes that the company operates as a 'blank check' or shell entity, a common structure in the OTC market often used to facilitate reverse mergers. The company's focus on 'cluster consumption' in the food industry is highly speculative and lacks a proven operational track record.

Comparison to Industry Standards

• The company's financial position is typical of a dormant shell company, characterized by zero revenue and reliance on related-party funding.
• The lack of an independent audit committee and material weaknesses in internal controls are common among smaller reporting companies but represent a significant governance risk compared to larger, exchange-listed entities.

Management Changes

Corporate Governance

Legal Proceedings

• None reported.

Related Party Transactions

• Settlement of $80,000 debt to Yan Ping Sheng via issuance of 40,000,000 common shares.
• Ongoing working capital advances from Yan Ping Sheng, which are non-interest bearing and due on demand.

Stakeholder Impact

• Shareholders face significant dilution risk from potential future share issuances.
• Voting control is highly concentrated, limiting the influence of minority shareholders.

Next Steps

• Continue search for a merger or acquisition target in the food industry.
• Seek additional capital through equity or debt financing.
• Improve internal controls and financial reporting procedures as funds become available.
• Appoint outside directors to form a functioning audit committee.

Key Dates

Recommendation

The company is a non-operational shell with no revenue, no cash, and significant going-concern risks. Investors are essentially betting on a future, unannounced merger, which carries extreme uncertainty and high risk of dilution.

Keywords

Cluster Group Holdings, CLUS, OTC Pink, Shell Company, Reverse Merger, Food Industry, Going Concern